China’s aviation regulator is expected to maintain current restrictions on international flights throughout the first half of 2022, Air China said.
The move has broad implications for tourism in the Asia-Pacific region, where overseas Chinese travelers normally play a disproportionate role, although other countries have also been slow to open borders due to vaccination rates. relatively low levels and increasing COVID-19 cases.
The Civil Aviation Administration of China (CAAC) said last month that weekly international flights were only 2% of 2019 levels, as more flights were suspended due to a number growing number of imported COVID-19 cases.
China’s three largest airlines, Air China, China Southern Airlines and China Eastern Airlines, said in their earnings calls that CAAC’s restrictions on international flights could continue until the first half of 2022, given the government’s COVID-19 prevention approach around the Beijing Winter Olympics in February.
Billions of yuan in losses
Expectations of a delayed recovery in international travel have partly led some analysts to renege on their earnings forecasts over the next few years. China Merchants Securities, for example, reduced its net profit estimates for Air China to -9 billion, 2.7 billion, and 6.7 billion yuan in 2021, 2022, 2023.
Air China’s management told analysts that China’s outbound travel recovery will be slower than that of the United States and Europe, adding that the vast majority of developing countries have failed to recover. achieves high vaccination rates.