France announces billions of aid to the aeronautical industry

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The French government announced Tuesday 15 billion euros (about 22.7 billion Canadian dollars) in rescue aid for the aerospace industry in the grip of a pandemic, including the aircraft manufacturer Airbus and the national airline Air France.The finance, transport, defense and environment ministers have unveiled a rescue plan for an industry that employs hundreds of thousands of people in France, whose livelihoods have been plunged into uncertainty in because of travel restrictions caused by the virus.

In exchange for aid, companies will have to invest more and faster in low-emission electric, hydrogen or other planes, because France intends to make its aeronautical industry “the cleanest in the world”.

“We will do everything to support this French industry which is so crucial to our sovereignty, our jobs and our economy,” said Finance Minister Bruno Le Maire.

Money includes direct government investment, grants, loans and loan guarantees. It also includes a special fund jointly funded by the government, Airbus and other large manufacturers to support small suppliers.

It includes 7 billion euros (about C $ 10.6 billion) in loans and loan guarantees that the government had already promised Air France, whose planes were almost entirely immobilized by the virus.

Airlines around the world have asked for government bailouts as they struggle to survive the virtual shutdown of their operations caused by the virus.

Airbus said it was cutting production by 35 to 40 percent, and rival Boeing announced when the virus was closed that it would cut its 161,000 employees by 10 percent by attrition, advance offers and layoffs.

“The recovery will be long,” warned Le Maire. The government has predicted that it will be 2023 before the industry reaches pre-crisis levels.

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