China to boost air freight capacity to stabilize supply chains

Hard-hit aviation sector in the cross-hairs as analysts forecast massive 2020 losses 

by Xu Jiangshan and Yang Zhijie
State Council will boost air freight capacity to stabilise supply chains
Cathay Pacific on Hong Kong has cancelled flights. Photo: AFP

(ATF) - The State Council decided in its executive meeting on Tuesday that China will takefurther steps to boost its international air freight capacity to stabilize supply chains.

Premier Li Keqiang stressed at the meeting that development of an international logistics and delivery services system must be accelerated to uphold the smooth running of the industrial chain, according to a Xinhua report.

“We must facilitate both international and domestic air transport services, and keep up our international air freight capacity to avert potential shocks to the supply chains and facilitate the restart of business operations,” Li was quoted as saying.

The meeting urged effective measures to increase the country’s international air freight capacity and ensure unimpeded shipments, which mainly include three aspects: strengthening international cooperation and unimpeded international express shipments; improving the air cargo hub network; and perfecting the air cargo standard system.

China’s airline industry has been hit hard by the coronavirus outbreak, which appears to have emerged in the central city of Wuhan late last year. Flights to and from the nation have been cancelled and analysts have downgraded their outlook on companies including China Eastern and Hong Kong’s Cathay Pacific.

Researchers at Jeffries in Hong Kong estimates the sector will report a 25.5 billion yuan ($3.7bn) loss this year, after originally predicting a 28.5bn yuan profit.