January 22, 2022

Israel Agrees for More Aid for El Al Airlines due to Travel Ban

3 min read

Last Thursday, the Israeli government announced that it would provide El Al Airlines with additional aid for helping compensate for the re-implementation of the coronavirus travel ban on overseas travel by citizens and entry of foreign tourists. The state would pay tens of millions of dollars would be paid to the Israeli flag carrier and the shareholders of El Al to assist it in weathering the pandemic, along with the quick spread of the Omicron variant in the country. The Finance Ministry stated that they would give the aid in the next couple of months and a similar deal would also be given to the other airlines in Israel, Israir and Arkia.

El Al has been demanding another aid package from the government, as Israelis are not permitted to travel to dozens of countries, including Britain and the United State and an entry ban on tourists once more into effect. Avigdor Liberman, the Finance Minister said that this new deal would assist airlines in overcoming the pandemic and also maintain the principle that external capital would be provided with state aid for strengthening the capital structure of the airlines. He added that he was hoping that Israel would open its skies in the coming months for all entering and leaving.

Israel had first closed its borders in March 2020 at the beginning of the pandemic and had reopened them briefly in November 2021. However, the rapid spread of the Omicron variant of the coronavirus in Israel drove the government to once more impose the ban on travel for Israelis and foreign tourists alike. Almost 1,900 employees have been laid off by El Al, which is almost one-third of its staff. This was part of a recovery plan that the government had mandated for the airline to receive an aid package of $210 million earlier in the air. The airline also had to cut down its fleet from 45 to 29.

Restrictions over the summer meant that the airline would receive additional aid of $30 million. The third quarter losses of El Al were about $136.2 million, which is typically the strongest period for the company, as opposed to a loss of $146.6 million a year before. The airline had initially hoped for higher sales in the fourth quarter, as the government had approved vaccinated tourists to enter Israel from November 1st. But, they had shut the country down to keep the Omicron variant out.

The latest Israel news indicates that some of the travel restrictions might be lifted soon since the new variant has already entered the country and spreading at a rapid pace. Gilad Kariv, the chairman of the Constitution, Law and Justice Committee of the Knesset said that the no-fly list would not get approval on Tuesday if the criteria for humanitarian exceptions wasn’t changed by the Population and Immigration Authority. Prime Minister Naftali Bennett had addressed the issue during the cabinet meeting on Sunday at the request of YoelRazvozov, the Tourism Minister. The latter said that isolation of vaccinated Israelis coming from abroad was no longer medically valuable.

He said that it should be done this week and vaccinated foreign tourists should also be allowed to enter because the tourism industry as well as the economy wouldn’t be able to shoulder the burden for long, despite the aid package. Bennett responded that they would probably open the skies in the coming week, depending on the infection numbers. He said that the new policy would be introduced with the collaboration of the Health, Interior and Tourism ministries. NachmanShai, the Diaspora Affairs Minister, said that some updates would be made this week.

On Saturday, 4,200 cases were diagnosed in Israel and 6% were found in those who had returned from abroad, while 94% of the cases were of people who were already in the country. The rates have been 12% and 88%, respectively in the past week.

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