State aid plan for Air Malta sent back to drawing board

The Maltese government has sent its state aid plan for Air Malta (KM, Malta Int’l) back to the drawing board but hopes to formalise its request with the European Commission by the end of March 2021 in order to obtain a lifeline for the struggling carrier.This was confirmed by Finance Minister Clyde Caruana whilst responding to questions from members of parliament last week, Malta Today reported. Caruana, who assumed responsibility for the airline when he entered the Cabinet in a reshuffle last November, said he felt the need for a “more robust” plan that would be better suited at ensuring the airline’s viability in the long term. He explained to the parliament that the first aid request – drawn up under Economy Minister Silvio Schembri – had been made in November 2020. Throughout the following month, Brussels had responded informally with questions of their own. “The formal request from the Maltese government to the European Union is expected to be made by the end of March this year. Meanwhile, the Treaty on the Functioning of the European Union allows governments to provide aid to remedy the damage caused by natural disasters or other extraordinary events, and the pandemic is being considered as an extraordinary event that has caused serious economic disturbance,” he said. The minister said the airline had finalised its annual accounts and that these would eventually be published, insisting that there was “nothing to hide.” The financial statements would first be submitted to the European Commission before publication, he said. The airline’s latest financial statement covers the year ending March 2018. As previously reported, earlier this year Caruana warned that Air Malta was “in a pitiful state” and had only “weeks to live” as it was losing EUR170,000 euros (USD205,000) daily or EUR62 million (USD74.8 million) per year.