March 12, 2020 / 2:44 PM / 25 days ago

Germany eyes liquidity help for airlines hit by coronavirus

BERLIN (Reuters) - The German government will meet representatives of airlines and labour unions on Monday to discuss the impact of the coronavirus outbreak and possible liquidity aid, an official said.

U.S. President Donald Trump on Wednesday imposed a 30-day ban on travel from Europe in an attempt to slow the spread of the virus, prompting sharp criticism from the European Union.

“Airlines are severely affected by the effects of the coronavirus. The entry ban to the United States is hitting Lufthansa particularly hard,” Thomas Jarzombek, the German government’s aerospace policy coordinator, said on Thursday.

The economy ministry is providing various instruments to help companies bridge short-term liquidity shortages, for example through special loans from state-owned KfW bank.

“These instruments are open to all industries, including the aviation industry, of course. If necessary, they can be expanded, made more flexible or used at short notice,” Jarzombek said. “Our goal is to preserve as many jobs as possible.”

The German government welcomed a decision by the European Union to temporarily suspend strict slot rules for airlines. “So at least the take-off and landing rights do not expire if many or all flights on a route are cancelled,” Jarzombek said.

EU chief Ursula von der Leyen said on Tuesday the bloc would suspend a rule requiring airlines to run most of their scheduled services or else forfeit landing slots, to give carriers some breathing space as the coronavirus crisis deepens.

The decision came as airlines worldwide scrambled to deal with the worsening virus epidemic and Italy’s lockdown, which have hammered passenger numbers and forced the cancellation of thousands of flights.

Reporting by Michael Nienaber and Christian Kraemer; Editing by Paul Carrel, Kirsten Donovan

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