RIYADH: Middle Eastern airlines will endure losses of $4.2 billion in 2021, down from $7.9 billion in 2020, as pandemic travel restrictions remain in place in much of the world, according to the International Air Transport Association (IATA).
Losses will be equal to 13.8 percent of revenues in 2021, an improvement from 28.9 percent in 2020, but still an historically bad number. Demand will be 67.6 percent lower than 2019 levels, while capacity will shrink 58.9 percent, IATA said.
While the region’s carriers will benefit from some of the highest vaccination rates globally, their relatively small home markets mean airlines like Emirates, Etihad and Qatar Airways will remain heavily exposed to international travel restrictions.
Globally, airline industry losses will narrow to $47.7 billion in 2021 from $126.4 billion in 2020, IATA said.
Airlines will burn through $81 billion of cash this year, following $149 billion in 2020, while the industry has taken on a further $220 billion of debt for a burden of $651 billion, IATA said.
“This crisis is longer and deeper than anyone could have expected,” said IATA Director General Willie Walsh. “Losses will be reduced from 2020, but the pain of the crisis increases. Government imposed travel restrictions continue to dampen the strong underlying demand for international travel.”