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The prospect of recovery of the European aviation industry is more blurred

Passengers wait in line for testing COVID-19 at Terminal 2 of Heathrow Airport, London, UK on January 18, 2021. Photo: Reuters

According to observers, this year’s Easter holiday (April 4) is almost hopeless for the European aviation industry.

In the UK, COVID-19 Vaccine Development Minister Nadhim Zahawi recommends that residents stop booking in advance of vacations. He said there are still 37,000 people in hospital because of COVID-19 and it is too early for the government to consider this summer vacation.

On Jan. 26, German Chancellor Angela Merkel told lawmakers that tourism should not take place in the midst of her government considering tougher measures.

During the crisis, governments tried to maintain movement between the EU states and the European Free Trade Association (EFTA). However, over the weekend, Sweden officially banned tourism from neighboring Norway, while Belgium banned non-essential travel.

Citi financial services analyst Mark Manduca warns that the rise in travel restrictions and the need for passenger testing threatens the airline industry’s prospects during the summer. Demand recovery momentum will also be weaker than investors expected.

British airlines and airports warned that further travel restrictions would become “catastrophic”, and called for a separate support package to help them survive the prolonged crisis. They also warned of new blockade orders threatening jobs and essential cargo operations, including medical equipment.

The airline’s shares have risen since the COVID-19 vaccine officially appeared in November 2020. However, these stocks have come under pressure this week on concerns that new variants of the SARS-CoV-2 virus and anti-epidemic blockade orders are threatening the industry’s very important summer tourism season.

While major airlines have secured enough liquidity to survive an expected slump that will last for months, new developments in the pandemic could force some firms to look. earn new capital to survive until next winter. Meanwhile, weaker airlines could go bankrupt.

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