Vietravel Airlines asks for $44mn state loan

Nguyễn Quốc Kỳ, chairman of Vietravel Airlines (VU, Hue Phu Bai Int’l) and president of its tour operator parent Vietravel, has written to the country’s prime minister proposing a VND1 trillion dong (USD43.6 million) five-year low-interest loan, at 4% to 5% per year, to ensure it survives the pandemic and can resume operations once travel returns, he told the Saigon Times.

Vietravel Airlines, like other tourism and aviation enterprises, needs more government support, he stressed, as banks have been subjecting such firms to interest rates on loans of between 5.5% and 9%. A few banks have committed to easing their rates but many others have not.

Besides offering preferential loans, he suggested that state assistance could come in the form of extending loan payment deadlines, supporting workers, and increasing access to Covid-19 vaccines so that the tourism market can gradually reopen. A state policy to reduce land rent has yet to be employed due to a lack of guidelines, Kỳ claimed.

Value-added tax could be cut to 5% – it currently stands at 10% – and corporate income tax to 16%, from 25% as it is now, for a period of three years, he added.

“I think the government needs to issue policies for the entire airline sector and have solutions to directly support airlines,” he told the Vietnamese language version of the newspaper. “Tourism, aviation, and other businesses need to freeze or extend debts and reduce interest rates, and not downgrade credit levels, to overcome the difficulties caused by the epidemic and return to the market. Policies need to have specific directions in order to be effective.”

He added: “Businesses paying social insurance and health insurance could receive support from the government to give back to their staff. This would help give accurate and effective support without having to waste time going and carrying out procedures.”

Kỳ also urged the government to start welcoming back international visitors with vaccine passports to places such as Phu Quoc, Nha Trang Cam Ranh, Qui Nhon, Quang Ninh, Hạ Long Bay, Huế, and Hội An, and also proposed vaccinating the employees of aviation and tourism companies.