China confirms aviation bailout
15 / 12 / 2008
THE Chinese government has confirmed a multi-billion dollar bailout for the country’s aviation industry. As reported in last issue’s Air Cargo News, the Civil Aviation Authority of China (CAAC) recommended the investment as a result of declining demand in both cargo and passenger traffic.
The deal will see each of the top three airlines – China Southern, China Eastern and Air China – get US$438.66 million before the end of the year. In addition, the country’s aviation infrastructure will be given $65.79 billion to build and expand national airports.
The fund works out to about seven per cent of the country’s gross domestic product each year for 2009 and 2010.
There are doubts that large amounts of the money have already been allocated earlier this year and that many of the projects have already been started making the true amount just announced, while still large, much smaller.