The state plans to pump 350 million euros into recapitalising Finnish airport operator Finavia to counter the effects of the coronavirus pandemic on the company.
The ministerial committee on economic policy has recommended that the government seek authorisation from Parliament for the recapitalisation, which is scheduled for next year's budget.
With this cash injection, Finland hopes to secure the future of the state-owned company. About 90 percent fewer passengers have passed through Finavia's airports since the outbreak of the coronavirus pandemic, compared to last year.
However, according to financial adviser Minna Pajumaa from the Prime Minister’s Office’s ownership steering department, the company’s financial situation is not acute, even though the business has suffered a significant loss of passengers.
"The company mapped austerity measures as soon as the crisis began," Pajumaa told news agency STT.
According to Finavia, the austerity programme, which came into effect in March, aims to save a total of 200 million euros. It includes large cost cuts from operational activities as well as long-term layoffs for all employees.
Finavia's net sales in 2019 were approximately 390 million euros as about 26 million passengers passed through its 21 airports.
Finnair's recapitalisation cost state nearly 300m euros
Finavia is a wholly state-owned company.
"The state, as a long-term owner, wants to develop Finavia's competitiveness and ensure that the conditions for good domestic and international air connections are maintained throughout Finland," says Minister for European Affairs and Ownership Steering Tytti Tuppurainen (SDP).
Finland had previously participated in the recapitalisation of national air carrier Finnair. The government applied for a parliament authorisation of a maximum of 700 million euros. However, according to Pajumaa, the state's share of the recapitalisation ended up being 286 million euros.
The government rationalises its decision to pump money into Finavia's extensive development program despite the loss of passengers by stating the investment will create opportunities for growth after the crisis.
The development program includes, among others, the Helsinki-Vantaa expansion project and the development of Lapland airports.