Airports of Ukraine asking for state assistance

Аэропорты Украины просят у государства помощи

The Board and the members of the Association “Airports of Ukraine” civil aviation Commission (AAUGA) addressed to the President of Ukraine, Verkhovna Rada and the Prime Minister with an open letter in which he asked for assistance from the state of the aviation industry.

This is stated in an open letter published on the website of the International airport “Kiev”.

“To ensure the safety of the aviation industry, we ask You to urgently intervene in the situation and to adopt a series of measures for state support of the industry: the adoption of the State target program of support of the aviation industry (airlines, airports, the air navigation service provider) for the purpose of leveling the negative consequences of the continued existence and development; the allocation from the State budget directly to the airports and the state enterprise “Ukraerorukh” earmarked funds (grants) to Finance the provision of services to airlines and aircraft of the Ministry of defence; the provision of airports, airlines irrevocable direct cash assistance from the state that will provide them with the minimum operation; the exemption of airlines from payment of VAT, a single fee for obligatory state social insurance and the tax to incomes of physical persons for 2-4 quarters 2020″, – stated in the text of the appeal.

Justifying the need for such steps on the part of the state leadership, the Association stressed that the aviation industry is a critical infrastructure, which employs tens of thousands of highly qualified specialists, the preparation of which required more than three years. At present, the cessation of air traffic has led to a complete cessation of revenues among all participants of the transport market.

“Only a drop in the volume of services of the armed forces in the airspace of Ukraine as of March 24, 2020 had already reached 87% with the prospect of further declines. Experts predict the aviation market and international organizations recovery to pre-crisis volumes may be delayed for at least 2-3 years according to the optimistic scenario,” the statement reads.

It is emphasized that, given the decision of the Cabinet of Ministers on introduction of state of emergency and the extension of quarantine measures to 24 April 2020 and the uncertainty about the future duration of such measures in Ukraine and the world, today the obvious risks of financial and socio-economic status of airports and airlines. The Association also emphasized that despite the lack of air traffic, international airports can be temporarily preserved and there is a need to continue to support them and to ensure the operation of airports as integral part of urban and national transport infrastructure.

“Providing airport activities is not only a socio-economic problem, but also one of the elements maintain an adequate level of national security of Ukraine”, – emphasized by market participants.

The Association also said that to ensure smooth functioning of airports, state enterprise “Ukraerorukh” and airlines, already today a number of anti-crisis measures, in particular a regime of downtime for the staff, substantially reduced wages, reduced operating costs to the lowest possible level, suspended all investment activity with their own funds, etc.

“Currently, the amounts of airlines is inadequate and will not ensure their functioning in the conditions of prolongation of quarantine measures. Without state support for airports and air traffic service provider – “Ukraerorukh” will not be able to perform their tasks, including for security and defence of the state, and will be forced to stop their activity, and any flights in the airspace of Ukraine”, – warned in the address.

In AAPA also reminded that the governments of different countries have already taken measures to support the aviation industry. In particular, reduced tax rates, deferred the timing of their payments or are canceled completely, partially (50% to 90%) kompensiruet businesses the cost of labor during downtime, loans of state banks in support of current liquidity, etc.

As noted, several European countries have already adopted the decision on providing economic and financial assistance to companies in critical infrastructure including the aviation industry. For example, the government of Estonia has allocated 2 billion Euro, Lithuania – 5 billion euros, Poland – 50 billion euros, Turkey $ 16 billion. USA.

As reported, the Association “Airports of Ukraine” civil aviation Commission (AAPA) was established in 1992 to promote the development of airports and aviation enterprises of Ukraine. The Association’s members today are 95 enterprises and organizations from 15 countries, including 21 airport of Ukraine and leading airlines-participants of the transport market, such as: GP “Ukraerorukh”, “ANTONOV”, the gap “Ukraine”, honglingjin, cateringove, toplivozapravshchiki companies of different ownership forms. In 2014 AAUGA a full member of the Council of Europe (“ACE EUROPE”), whose members include approximately 500 airports and airlines of Europe.

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