Bankrupt British Airline is Latest Victim of Coronavirus

Britain’s biggest domestic airline is the latest casualty of the coronavirus outbreak. Flybe was rescued from near collapse in January but finally went bankrupt Thursday, hit by low demand and customer cancellations in the wake of the Covid-19 outbreak. Britain had reported close to 100 infections as of Thursday.

Flybe served mainly British and European regional airports rather than major hubs. Its collapse is being seen as a setback for government efforts to improve connectivity and re-balance the British economy away from London.

“We feel really sad, just really sad,” Flybe crew member Katherine Denscham said as she prepared to leave her workplace at Exeter airport in Britain’s southwest.

The International Air Transport Association (IATA) warned Thursday that the entire global airline industry is suffering amid a huge downturn in bookings.

“We could see the effect on revenues exceed $100 billion, around about 19 percent of global passenger revenue. So this would be a revenue shock equivalent to what was seen in the global financial crisis,” IATA Chief Economist Brian Pearce told a press conference in Singapore.

Cases of Covid-19 in Britain have risen sharply in recent days. The government said Thursday the focus is moving from containment to delaying its peak impact. Prime Minister Boris Johnson told reporters that planning is underway for the worst-case scenario: a breakdown in law and order.

“There are long established plans by which the police will… obviously keep the public safe, but they will prioritize those things that they have to do. And the army is, of course, always ready to backfill as and when. But that is under the reasonable worst-case scenario,” Johnson said this week.

Across Europe big gatherings are being canceled or postponed, from trade shows to sporting events as the economic impacts are starting to bite. Italy has closed all schools and universities. In Venice, normally packed with visitors year-round, the famous canals are all but empty. Tourism numbers are down across the world.

Car sales in China have plunged by 80 percent in a month. Supply chains are disrupted across the globe. The International Monetary Fund has slashed growth forecasts – and announced this week that it will offer up to $50 billion in loans for poorer countries that could struggle to deal with a Coronavirus outbreak.

“We do have up to $10 billion available for low income countries to tap in with zero interest rates,” IMF Managing Director Kristalina Georgieva told reporters. “And obviously we would prioritize countries, especially countries in Africa, that have already been faced with difficulties.”

Many African countries would struggle to cope with a large outbreak according to a recent study published in the Lancet, which highlighted Nigeria, Ethiopia, Sudan, Angola, Tanzania, Ghana, and Kenya as being among the most vulnerable.

“Preventing the entry of the virus will become increasingly difficult, especially if the international spread continues,” report co-author Marius Gilbert of the Free University of Brussels told VOA. “And given those data that indicate that the quality of care really has a strong impact on how serious it can be and how fatal it can be, I think that moving toward funding better healthcare in general would be quite a useful strategy.”

The one bright spot is that new infections in China, the source of the virus, continue to fall. Whether other countries can replicate Beijing’s response remains to be seen.

Source: Voice of America