Despite With-Corona, China's Air Routes Remain Blocked... Aviation Industry Recovery Still Distant

Despite the transition to the With-Corona policy, China's aviation industry is struggling to recover to pre-COVID-19 levels. The resumption of routes is delayed due to complex geopolitical conditions such as the deterioration of US-China relations, and domestic flights face competition from high-speed rail.

On the 21st, Hong Kong's South China Morning Post (SCMP) reported that Chinese airlines have not been able to restore major routes to the US, South Korea, Japan, and other countries due to various issues. Private airlines are still suffering from the pandemic's impact and have called for government support.

[Image source=AP Yonhap News]

According to the China Air Transport Association (CATA), the number of outbound flights last month was only about one-third of the same period in 2019. CATA forecasts that it will be difficult for the number of flights on one of the major routes, China-US, to recover by the end of the year. The association also predicts that due to geopolitical factors, the routes to Japan and South Korea will remain pessimistic for the next few years. The underlying factors cited include geopolitical tensions, trade frictions, shortages of key resources at overseas airports, and visa processing issues.

Recently, US Secretary of State Tony Blinken and Chinese Foreign Minister Qin Gang, who visited China, agreed on the need to improve the aviation route environment between the two countries, but no meaningful changes have yet occurred.

Additionally, rising oil prices and the depreciation of the yuan are putting further pressure on China's aviation industry. According to an annual report, the combined losses of China's three major airlines?Air China, China Eastern Airlines, and China Southern Airlines?last year amounted to 108.7 billion yuan (approximately 19.5323 trillion KRW). The industry expects operating losses to continue through the second quarter of this year.

Domestic demand for flights within China is also sluggish compared to the overall recovery of the service sector. According to a report by the online flight service app Umetrip, domestic flight bookings during the three-day Dragon Boat Festival holiday starting on the 22nd more than doubled compared to usual, but CATA explained that "short-distance routes are being replaced by high-speed trains, which significantly affects flight operations." Even the Beijing-Shanghai route, considered the busiest in the world, has not returned to 2019 passenger levels.

The association argues that for these reasons, the aviation industry support policies implemented by China last year should be extended until the end of 2024. The related support measures include the extension of special emergency loans for private airlines. Furthermore, CATA insists that bond issuance worth 200 billion yuan should also be implemented.

This content was produced with the assistance of AI translation services.