The Airport Authority of Hong Kong (AAHK) has released a fourth wave of financial aid measures to provide urgent relief to home-based operators, all threatened with financial collapse during the ongoing pandemic and government-imposed travel curbs.
According to a statement from the authority, the new $258 million package will fund the purchase of around 500,000 flight tickets in advance from Hong Kong’s four carriers —Cathay Pacific, Cathay Dragon, Hong Kong Airlines, and HK Express—as part of a larger government effort to inject fresh capital into the air transport system. The AAHK said it would give away the tickets to both residents and international visitors as a broader component of a “future market recovery campaign” planned for a later date. Airlines also are entitled to a one-off subsidy of some $129,000 for each large jet and roughly $26,000 for smaller aircraft as long as the airplanes are registered in Hong Kong.
Airport operators involved in ramp handling, maintenance, catering, fueling, and other related services also stand to benefit after the authority announced a funding scheme that would offer cash upfront for ground services equipment (GSE). The initiative would allow operators to use the equipment for free for an undisclosed period with the right to a buyback. Under the plan, firms that employ a hundred people or more would get about $387,000 in financial assistance while companies with less than a hundred employees will receive roughly $129,000.
The new measures, which bring the total value of aviation subsidies in Hong Kong to $593 million, account for part of a larger $17.7 billion economic stimulus package announced late Wednesday evening. Speaking at a press conference, Hong Kong International Airport chief executive Carrie Lam acknowledged the city’s international gateway had “almost closed,” due to the pandemic. According to Lam, some 75,000 airport employees will receive a government wage subsidy, which will pay 50 percent of workers’ salaries for up to six months with a monthly cap of about $1,160. On Thursday, the authority said its CEO and six executive directors would take a voluntary pay cut of 20 percent for six months starting in April.
Separately, Bloomberg reported the airport seeks a $2.6 billion loan to help fund a third runway. While the authority did not confirm the report, it did admit to “facing a significant shortfall in revenue” due to declining passenger numbers.
“The [authority] will go to the financial markets in the next two months to raise the necessary funds, in order to maintain its own liquidity for funding the airport operation and the committed capital projects,” an airport spokesperson said. “The loan will also be used to finance the new relief package.”