Latvia’s government has approved a €90 million investment in state-owned carrier airBaltic.

The funds will be utilised to compensate for damages incurred as a result of the ongoing Covid-19 pandemic as well as to address the current economic crisis.

“The support of our majority shareholder to overcome the crisis reflects the recognition of the positive impact airBaltic has on the economy,” said Martin Gauss, CEO of airBaltic.

“The investment is planned to be returned to the Latvian state in form of proceeds from selling shares during a planned initial public offering of airBaltic in the future.”

The financing is contingent on the European Commission’s approval.

Gauss continued: “When the pandemic started in 2020, the company performed a significant cost reduction program and preserved around 1,000 employees which were required to maintain the operation of the airline.

“The equity received in 2020 has been used responsibly to maintain operations and cover expenses that could not have been avoided due to the Covid-19 pandemic.”

airBaltic is a vital part of the Latvian economy, accounting for more than 2.5 percent of the country’s GDP.

The number of passengers carried by airBaltic plummeted by 73% in 2020 as a result of the Covid-19 pandemic, which had a substantial impact on operations.

– India’s new age travel digital media