Xinhua
15 Jan 2022, 04:00 GMT+10
VALLETTA, Jan. 14 (Xinhua) -- Air Malta, the country's flag carrier, will reduce the number of employees by half as the government plans to make the airline financially viable, Finance Minister Clyde Caruana said here on Friday.
The airline currently has 890 employees, and the plan is to offer around 470 of them jobs in other government sectors with the same conditions and salary.
The move, to be completed by this summer, is expected to save the airline around 15 million euros (17.1 million U.S. dollars) per year, Caruana told a press conference.
The restructuring plan was unveiled as the government awaits the European Commission's final decision on how much in state aid it can inject into the airline.
The plan also foresees the negotiation of new collective agreements to allow the airline more flexibility and to introduce new and sustainable operational practices.
Caruana said the cost-cutting plan will see the airline close its ground and baggage handling operations, which alone employ 300 people. Another 110 administrative staff will also be transferred to other government sectors.
Air Malta will cut unprofitable routes and will attempt to operate flights that would not land in Malta. Caruana said these changes were needed to save the airline, which has racked up over 258 million euros in operational losses since 2005.
"We have made strong arguments with the European Commission that Air Malta has a fighting chance, and we believe that our plan will save the company from bankruptcy," he told the news conference.
"We have to be serious about this plan. It could very well be Air Malta's last chance," he added.
Plans for Air Malta to fly to airports on other continents, for example to New York or Mumbai in India, have been ditched.
Air Malta has had a negative equity since 2011. In 2012, the EU cleared a 130-million-euro state aid restructuring plan for the airline, but it was soon eaten up by the rising costs.
The COVID-19 pandemic dealt a major blow, with the airline receiving over 300,000 requests for refunds totaling 32 million euros and issuing 80,000 flight vouchers, equivalent to 12 million euros.
Although the Mediterranean island country's economy is heavily dependent on foreign trade and tourism, the Central Bank of Malta has predicted last December that the country's gross domestic product (GDP) will grow by 6.5 percent in 2022 and 5.3 percent in 2023, higher than the previous forecast. (1 euro=1.14 U.S. dollars)
Get a daily dose of Europe Sun news through our daily email, its complimentary and keeps you fully up to date with world and business news as well.
Publish news of your business, community or sports group, personnel appointments, major event and more by submitting a news release to Europe Sun.
More InformationBRUSSELS, Belgium: Meta is holding firm on its controversial pay-or-consent model, a move that could lead to fresh antitrust charges...
LONDON, U.K.: American consumers and businesses could soon face the highest overall tariff burden in more than a century, according...
The family of Sayfollah Saif Musallet, a 20-year-old American citizen who was beaten to death by Israeli settlers in the occupied West...
CONCORD, New Hampshire: A federal judge in New Hampshire issued a crucial ruling on July 10 against President Donald Trump's executive...
DUBAI, U.A.E.: A cargo ship flagged under Liberia, known as the Eternity C, sank in the Red Sea following an attack executed by Yemen's...
WASHINGTON, D.C.: The Trump administration has started sending some weapons to Ukraine again, just a week after the Pentagon told officials...
NEW YORK CITY, New York: Bitcoin surged to a new all-time high this week, buoyed by growing institutional interest and a wave of pro-crypto...
SHENZHEN, China: As global chip competition intensifies, Huawei Technologies is exploring new markets in the Middle East and Southeast...
LONDON/NEW YORK CITY: American grocery bills may be headed higher as coffee and orange juice prices face upward pressure from new tariffs...
BATTLE CREEK, Michigan: In a major consolidation of iconic food brands, WK Kellogg has agreed to be acquired by the owner of Ferrero...
WASHINGTON, D.C.: Filmmaker Peter Jackson's lifelong fascination with the extinct giant New Zealand flightless bird called the moa...
NEW DELHI, India: India has submitted a revised proposal to the World Trade Organization (WTO) in Geneva to implement retaliatory tariffs...