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I UNDERSTAND
English Section

EU OKs aid to Polish state airline LOT hit by pandemic

23.12.2020 00:05
The European Union’s executive has cleared EUR 650 million worth of Polish state aid to the national air carrier LOT, which has been battered by the coronavirus pandemic.
LOT
LOTPAP/Darek Delmanowicz

The European Commission said on Tuesday it “has approved two Polish measures, for a total of about EUR 650 million (approximately PLN 2.9 billion), to support the airline LOT in the context of the coronavirus outbreak.”

The EU executive added that the aid measures consisted of a EUR 400 million subsidized loan and a capital injection of around EUR 250 million.

The measures were approved under temporary state aid rules that the European Commission originally adopted in March and then amended several times over the course of the year.

Margrethe Vestager, Executive Vice-President of the European Commission in charge of competition policy, was quoted as saying that LOT "plays a key role for the connectivity and economy of Poland."

Vestager added that, with these measures, Poland would be able to help the airline weather the coronavirus crisis.

The European Commission said on its website that LOT, a major network airline in Poland and Central Europe, suffered substantial losses in the second quarter of this year due to a coronavirus outbreak and travel restrictions that Poland and other countries had to impose to limit the spread of the virus.

“The significant drop in travel demand and the restrictive measures continue deteriorating the financial situation of the airline,” the EU executive said, adding that LOT was as a result "facing a risk of default and insolvency."

The aid measures aim to restore LOT's equity and liquidity position in order to ensure continued air transport services, the European Commission also said.

(gs/pk)

Source: IAR, PAP, ec.europa.eu