by Jim Byers
Last updated: 5:41 PM ET, Sun April 26, 2020
Canada's energy sector has been the recipient of a major federal program to help it battle the effects of the COVID-19 pandemic and plummeting oil prices. So far, there's very little mention of the travel sector and tourism.
That could be changing. Federal Finance Minister Bill Morneau did a video interview with Bloomberg News last Friday and talked about help for the airlines.
Morneau said his government has offered help to small businesses, such as Friday's announcement about rent assistance, which could be a big help to travel agents. He also said mid-size companies in the hospitality sector need help.
"We're going to be talking more about mid-size firms, whether it's in the energy sector or the hospitality sector or other parts of our economy that might be hard hit, that they can get access to credit," Morneau said. "And, finally, we are going to need to think about those largest of firms, the firms like WestJet and Air Canada, organizations that are going to need a bridge; they're going to need a bridge through this time, and credit availability for them in many cases will be challenging, (but) that's what we're trying to ensure that we're there to provide."
Canadian airlines are flying nearly empty planes across Canada and have converted some passenger planes to cargo craft so they can fly needed medical equipment into Canada. Flights out of the country have been cancelled, and airlines have had to be lay off thousands of workers, some of whom are being paid a partial salary thanks to federal subsidy programs.
Tour operators, hotel and resort owners and others in the tourism and travel trade also have been decimated. One recent report said Canadian luxury hotels are running at an occupancy level of less than five per cent.
The Liberal government on March 30 said it was waiving ground lease rents from March 2020 through to December 2020 for the 21 airport authorities that pay rent to the federal government. The government will also provide comparable treatment for PortsToronto, which operates Billy Bishop Toronto City Airport and pays a charge to the federal government.
"This support will help airports reduce cost pressures and preserve their cash flow as they deal with the effects of COVID-19 on their revenue streams. This will provide relief up to $331.4 million, reflecting payments in the same period of 2018," Morneau said at the time.
It's an important move, but some industry officials have said it's not nearly enough.
Passenger revenue is expected to drop by $64 billion US in North America and $314 billion US globally in 2020 compared to last year, according to he International Air Transportation Association, which represents 290 airlines comprising 82% of global air traffic.
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