Welsh Government to write off more than £42m of Cardiff Airport debt
The Welsh Government will write off £42.6m in Cardiff Airport debt, and provide another £42.6m in the form of a grant, to secure its long term future and recovery post-Covid.
Economy Minister Ken Skates announced the plan in a statement and said delay risked "the loss of the airport."
He said "This decision maximises the likelihood of recovery of Welsh Government loan investment and delivers the lowest lifetime cost option.
"It provides the best way forward for the Welsh Ministers as sole shareholders of the airport from a commercial perspective."
Mr Skates also said Cardiff Airport had not received any direct support from the UK Government during the pandemic.
The Welsh Government bought Cardiff Airport in 2013 for around £52m.
Prior to the pandemic the airport had seen a turnaround in fortunes and passenger numbers had increased significantly.
But Covid-19 has had a catastrophic impact on the aviation industry and air traffic fell to its lowest level for 17 years in 2020.
A Civil Aviation Authority (CAA) report shows passenger numbers at Cardiff Airport declined by 87% over the last year - more than any other UK airport.
Despite the majority of staff having been furloughed, the Welsh Government said the airport has lost £46.3m as a result of Covid.
Spencer Birns, Interim CEO of Cardiff Airport, commented: “We welcome today’s announcement that the Welsh Government has committed to provide financial support as part of a five year rescue and recovery plan for Cardiff Airport.
“It demonstrates the Welsh Government recognises the challenges we face as a business and the support we are going to need during this recovery phase. It acknowledges the excellent progress we have already made and reaffirms the need for a national airport that serves and delivers for the people of Wales."
He continued: “Until the pandemic hit us in March last year, we were enjoying successes and growing steadily, with our passenger numbers increasing by more than 50% during our seven years in government ownership.
“The global aviation industry is one of the sectors hit hardest by this pandemic. Cardiff Airport has been massively impacted by Covid-19 and the devastating effect it has had on the demand for passenger travel, particularly on flying."