"Portugal seeks EU approval for $553 million in aid for national carrier"

" \n TAP Air Portugal is one of many airlines that has had to undergo a restructuring process to negate the financial impacts of COVID-19. \n \n\n \n However, while this process is ongoing, it still has expenses to cover in terms of its running costs. As such, the Portuguese government has sought EU approval to provide \u2018interim aid\u2019 during this restructuring period. \n \n\n \n <a href=\"http:\/\/www.pinterest.com\/pin\/create\/bookmarklet\/?url=https%3A%2F%2Fsimpleflying.com%2Ftap-air-portugal-aid%2F&media=data%3Aimage%2Fsvg%2Bxml%2C%253Csvg%2520xmlns%3D%27http%3A%2F%2Fwww.w3.org%2F2000%2Fsvg%27%2520viewBox%3D%270%25200%25201000%2520800%27%253E%253C%2Fsvg%253E&description=If%20approved%20by%20the%20European%20Commission%2C%20the%20Portuguese%20government%20will%20support%20its%20flag%20carrier%20with%20more%20than%20%24500%20million%20of%20aid.%20Photo%3A%20Vincenzo%20Pace%20%7C%20Simple%20Flying&is_video=false\" target=\"_blank\" rel=\"noreferrer noopener\"> If approved by the European Commission, the Portuguese government will support its flag carrier with more than $500 million of aid. Photo: Vincenzo Pace | Simple Flying \n \n\n \n Aid to cover costs while restructuring \n \n\n \n It emerged yesterday that the Portuguese government is looking to provide TAP with \u20ac463 million ($553 million) of interim aid. Local news website\u00a0Portugal Resident\u00a0reports that this is subject to approval from the European Commission, an executive, legislative branch of the EU. \n \n\n \n The need for such aid has arisen due to the lengthy nature of the airline\u2019s ongoing restructuring process. This itself is\u00a0unlikely to receive approval from Brussels before April. However, in the meantime, TAP still needs to cover its operating costs. This is where government aid comes in. \n \n\n \n The airline industry\u2019s present state means that it cannot meet these financial demands through revenue alone. This is because widespread travel restrictions have forced TAP to cut most of its flights, with\u00a0capacity ending up as low as just 7%\u00a0in February. \n \n\n \n <a href=\"http:\/\/www.pinterest.com\/pin\/create\/bookmarklet\/?url=https%3A%2F%2Fsimpleflying.com%2Ftap-air-portugal-aid%2F&media=data%3Aimage%2Fsvg%2Bxml%2C%253Csvg%2520xmlns%3D%27http%3A%2F%2Fwww.w3.org%2F2000%2Fsvg%27%2520viewBox%3D%270%25200%25201000%2520667%27%253E%253C%2Fsvg%253E&description=TAP%20operated%20at%20just%207%25%20capacity%20in%20February.%20Photo%3A%20Vincenzo%20Pace%20%7C%20Simple%20Flying&is_video=false\" target=\"_blank\" rel=\"noreferrer noopener\"> TAP operated at just 7% capacity in February. Photo: Vincenzo Pace | Simple Flying \n \n\n \n This reflects TAP\u2019s executive president Ramiro Sequeira\u2019s admission that 2021\u2019s first three months \u201chave been worse than we were expecting.\u201d However, Pedro Nuno Santos, Portugal\u2019s\u00a0Minister for Infrastructure and Housing, hopes that the interim aid, if approved, will help reduce the impact of cuts that may come about as a result of the airline\u2019s restructuring. \n \n\n \n Cuts to fleet and personnel \n \n\n \n TAP has struggled ever since the start of the worldwide health crisis, and posted a\u00a0$443 million loss\u00a0for Q1 of 2020. After further struggles throughout last years, December saw the Portuguese government unveil a proposed $4.1 billion rescue package for the airline. \n \n\n \n While this would save TAP, it does also put\u00a0more than 3,500 jobs at risk. This figure would include 500 pilots, 750 cabin crew, 750 ground crew, and 1,600 employees on short-term contracts. Remaining employees would also likely be subjected to a 25% pay cut. \n \n\n \n <a href=\"http:\/\/www.pinterest.com\/pin\/create\/bookmarklet\/?url=https%3A%2F%2Fsimpleflying.com%2Ftap-air-portugal-aid%2F&media=data%3Aimage%2Fsvg%2Bxml%2C%253Csvg%2520xmlns%3D%27http%3A%2F%2Fwww.w3.org%2F2000%2Fsvg%27%2520viewBox%3D%270%25200%25201000%2520667%27%253E%253C%2Fsvg%253E&description=Thousands%20of%20TAP%20employees%20are%20currently%20at%20risk%20of%20losing%20their%20jobs.%20Photo%3A%20Getty%20Images&is_video=false\" target=\"_blank\" rel=\"noreferrer noopener\"> Thousands of TAP employees are currently at risk of losing their jobs. Photo: Getty Images \n \n\n \n TAP will also see its fleet shrink to a more manageable level, in line with present demand. In December, the number of TAP aircraft was set to drop by 18.5%, from 108 to 88. Of these 20 lost aircraft,\u00a0six narrowbodies\u00a0moved to\u00a0Cotswold Airport, UK, for storage in January, \n \n\n \n Union matters to resolve as well \n \n\n \n TAP is also having a hard time convincing certain workers\u2019 unions to accept the terms of its proposed emergency agreement. Last month, it reached a vital milestone, when it\u00a0won the support of the pilots\u2019 union,\u00a0 Sindicato dos Pilotos da Avia\u00e7\u00e3o Civil \u00a0(Civil Aviation Pilots Union). \n \n\n \n However, TAP\u2019s different sections of employees are represented by various unions, with the total number said to be around 12. This leaves it with a lot of convincing still to do, although getting the pilots on its side will have helped. \n \n\n \n It will surely hope that the government obtains EU approval to provide interim aid, which would increase its economic stability in these discussions. \n "

"Portugal seeks EU approval for $553 million in aid for national carrier"

Cocoa’s surge is drawing Africa’s farmers back to the beanAMP

Why Nigeria’s currency rebounded and what it means for the economyAMP

West Africa-focused gold miner Asante Gold to bid for Newmont’s AkyemAMP

Ghana seeks to delay cocoa deliveries due to lack of beansAMP

Zimbabwe ZiG currency rally enters 3rd day, adds 0.4% vs dollarAMP

Naira jumps to 8-month high of 1,120/$ as dollars flood black marketAMP

GACL staff interdicted over alleged cocaine smuggling at KIAAMP

No sweetheart deal with Fidelity Bank – ECG insistsAMP

Inflation projected to dip by 100bps in April 2024AMP

Cocoa’s surge is drawing Africa’s farmers back to the beanAMP

Why Nigeria’s currency rebounded and what it means for the economyAMP

West Africa-focused gold miner Asante Gold to bid for Newmont’s AkyemAMP

Ghana seeks to delay cocoa deliveries due to lack of beansAMP

Zimbabwe ZiG currency rally enters 3rd day, adds 0.4% vs dollarAMP