Colombian airlines face controversy over loans to survive pandemic crisis

Colombian airlines face controversy over loans to survive pandemic crisis

Governments worldwide — from Singapore to the Netherlands and the US — have devoted more than $85 billion to prop up airlines during the coronavirus pandemic. But airlines' requests for aid are controversial in less rich Latin American economies, where millions live in poverty and public health systems are ill-equipped to respond to a large-scale health crisis.

By
Jorge Valencia

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An aerial view shows Colombian airline Avianca’s planes parked at El Dorado International Airport amid the coronavirus disease (COVID-19) outbreak in Bogotá, Colombia, April 7, 2020.

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Luisa Gonzalez/Reuters

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The Colombian government is considering extending loans to the country’s airlines, as the coronavirus pandemic has grounded their fleets and wiped out most of their revenue through at least June.

Altogether, the country’s airlines would need some $1.2 billion in financial aid to stay in business without flying through the middle of the year, according to the International Air Transport Association, an industry trade group. Most of the cash would likely go to Avianca, which accounts for about half of Colombia’s flights and passengers. Avianca filed for Chapter 11 bankruptcy protection in the United States last week.

Governments worldwide — from Singapore to the Netherlands and the US — have devoted more than $85 billion to prop up airlines during the coronavirus pandemic, according to a Bloomberg News analysis. But the request for financial aid is controversial in less rich Latin American economies, where millions live in poverty and public health systems are ill-equipped to respond to a large-scale health crisis.

Related: ‘Reckoning day’ could be ahead for airline industry amid coronavirus challenges

Medellín-based Vivia Air, Colombia’s largest low-cost carrier, has not laid off any of its roughly 730 workers but has instituted across-the-board salary cuts, the company’s chief executive, Felix Antelo, told The World. Antelo’s salary was reduced by 70%. The company is asking the government for a $50 million bridge loan to restart operations once air traffic returns, he said.

“Not for a bailout, not for relief,” Antelo said. “It’s a loan that we will repay, obviously, and those are figures that are reasonable for a country like Colombia.”

Carolina Cortizo, managing director of Bogotá-based airline, Wingo, which employs about 230 people, said the company has reduced its costs by 20% — “which would have seemed awesome pre-COVID[-19]” — but is looking to make further cuts. The company is seeking a loan from the government of less than $12.5 million, she said.

“There’s nothing I want more than to get our planes back in the sky,” Cortizo said. “Our team has been putting a huge effort into the back-to-normal of our airline.”

Related: Governments offer aid as airlines forced to deepen cuts to flights, staffing

But many leaders in Latin America likely see air travel as a luxury and may be reluctant to extend help to airlines during the crisis, said Thijs Boonekamp, an economist with SEO Amsterdam Economics, a think tank. 

In Colombia, about 1 in 4 people live below the poverty line. And in Mexico, President Andrés Manuel López Obrador halted the construction of a new airport for Mexico City because he said it would represent no benefit to the working poor. 

Latin American countries have less “fiscal space” than richer economies to help airlines, said Tomás Serebrisky, an economist with the Inter-American Development Bank.

“They are allocating those resources to more immediate and urgent needs like the need to revamp the health system, or provide income support to the most vulnerable poor of the population,” Serebrisky said.

James Blake – If The Car Beside You Moves Ahead

[Verse 1]
Chemical days so I can draw
Conclusions in my ways
I’ve come to take as law
Always you [?]
Always you [?]

[Chorus]
If the car beside you moves ahead
As much as it feels as though you’re dead
You’re not going backwards
You’re not going backwards
If the car beside you moves ahead
As much as it feels as though you’re dead
You’re not going backwards
You’re not going backwards

[Bridge]
How can you sleep?
How can you sleep?

[Verse 2]
Chemical days so I can draw
Conclusions I’ve come to take as law
Always Pakistan and Netherlands

[Chorus]
If the car beside you moves ahead
As much as it feels as though you’re dead
You’re not going backwards
You’re not going backwards
If the car beside you moves ahead
As much as it feels as though you’re dead
You’re not going backwards
You’re not going backwards

Huncho Jack, Travis Scott & Quavo – Eye 2 Eye (On Jimmy Kimmel) (Live)

[Intro: Kodak Black]
Murda on the beat, that’s not nice, man

[Chorus: Quavo]
Real nigga, I
Get high, touch the sky
Right hand in the air
Left hand in the pot
Real nigga, I
We see eye to eye
Real nigga, I
We see eye to eye
Yeah yeah (yeah)

[Post-Chorus: Travis Scott]
I see green in your eyes, it don’t lie (it’s lit!)
Blue dollar bills in them hills to the sky (cash!)
We put the floor on dash
Know all my hoes they go and cash
Over that bag, they mad
I know the problem, yeah yeah

[Verse 1: Travis Scott]
Eye to eye (yeah!)
Trips to Dubai (yeah yeah)
I could see that they jealous, don’t know why (yah)
Is it ’cause we lit at 4 AM at the spot?
Put that on your tongue, wait for the swag to unlock (yeah!)
If you searching, come look for us (alright!), over the border (it’s lit!)
We import ’em (yeah!), just don’t record us (straight up!)
Poppin’ at the crib, the living room look like The Forum
Roll the dice at night, I take the chance in the morning

[Interlude: Quavo]
Know what I mean?
We ain’t really with that camera shit
Nah

[Verse 2: Quavo]
We fuck up for real, for real, for real
We fuck up the check for real (checks)
We havin’ the lean, exotics, and percs, she havin’ the X pill (lean)
We know how to flex for real
We hop on the jet, the time we kill (pew)
These niggas be wildin’, chasin’ money
While I’m signing deals (ye)
I got a ‘Tek Philippe (ye)
And I bought a skeleton (ice, ye)
I’m a deadly weapon (ye)
I’m about to go off in a second (vroom, yeah)
Moving bricks and medicine (bricks)
She like to fly, pelican (brr)
Touch the sky, heavenly (sky)
Designer belt from the Netherlands (yeah yeah)

[Chorus: Quavo]
Real nigga, I
Get high, touch the sky
Right hand in the air
Left hand in the pot
Real nigga, I
We see eye to eye
Real nigga, I
We see eye to eye
Yeah yeah

[Post-Chorus: Travis Scott]
I see green in your eyes, it don’t lie (green)
Blew dollar bills in them hills to the sky (yeah!)
We put the floor on dash (skrrt skrrt)
All of my hoes they go and cash (skrrt skrrt)
Over that bag, they mad
I know the problem, yeah yeah

[Verse 3: Takeoff]
Real nigga, I (I), pop a perc’ and fly (brr)
Crack that seal and take a whiff and I come back alive (die)
Niggas commit suicide when they don’t got mob ties
Flip it like it’s Five Guys, I’m 2Pac, get all eyes (all)
Look at the bitch, she a dime
So many watches, a nigga can’t run out of time
They get out of line
The gang in your yard with the strap like the Uber driver with the sign (brrt)
I’ve been known to tell the truth in my raps but these other rapper tell lies (lies)
Real niggas keep the trap alive
Ain’t no fabrication on the vine (it’s cap)

[Chorus: Quavo]
Real nigga, I
Get high, touch the sky
Right hand in the air
Left hand in the pot
Real nigga, I
We see eye to eye
Real nigga, I
We see eye to eye
Yeah yeah

[Post-Chorus: Travis Scott]
I see green in your eyes, it don’t lie (green)
Blue dollar bills in them hills to the sky (yeah!)
We put the floor on dash (skrrt skrrt)
All of my hoes they go and cash (skrrt skrrt)
Over that bag, they mad
I know the problem, yeah yeah (yeah!)

[Outro: Travis Scott]
Skrrt skrrt, skrrt skrrt