Жамият ва инновациялар –
Общество и инновации –
Society and innovations
Journal home page:
https://inscience.uz/index.php/socinov/index
Impact of the coronavirus pandemic on the aviation industry
in Uzbekistan
Donier NIMATOV
1
, Dilfuza IMAMOVA
2
University of World Economy and Diplomacy
ARTICLE INFO
ABSTRACT
Article history:
Received April 2021
Received in revised form
20 April 2021
Accepted 15 May 2021
Available online
25 June 2021
The article analyzes the impact of the undertaken anti-crisis
measures based on the analysis of the volumes of transported
goods, the problems of the industry in the current circumstances
caused by the coronavirus pandemic in the world are
characterized. Specific measures have been formulated to
mitigate the negative impact on economic development.
2181-1415/© 2021 in Science LLC.
This is an open access article under the Attribution 4.0 International
(CC BY 4.0) license (https://creativecommons.org/licenses/by/4.0/deed.ru)
Keywords:
the coronavirus pandemic,
aviation industry,
new perspectives,
anti-crisis measures,
air transport,
state.
Коронавирус пандемиясининг Ўзбекистоннинг авиация
саноатига таъсири
АННОТАЦИЯ
Калит сўзлар:
коронавирус пандемияси,
авиация саноати,
янги истиқболлар,
инқирозга қарши чоралар,
ҳаво транспорти,
давлат.
Мақолада ташилаётган товарлар ҳажмини таҳлил қилиш
асосида қабул қилинган инқирозга қарши чораларнинг
таъсири таҳлил қилинади, дунёда коронавирус пандемияси
келтириб чиқарган ҳозирги шароитда соҳа муаммолари
тасвирланган. Иқтисодий ривожланишга салбий таъсирни
юмшатиш бўйича аниқ чора-тадбирлар ишлаб чиқилган.
1
Master, University of World Economy and Diplomacy. Tashkent, Uzbekistan.
2
Сandidate of legal Sciences (PhD), Assistant Professor, University of World Economy and Diplomacy, Tashkent,
Uzbekistan.
Жамият ва инновациялар – Общество и инновации – Society and innovations
Special Issue – 5 (2021) / ISSN 2181-1415
290
Влияние пандемии коронавируса на авиационную отрасль
Узбекистана
АННОТАЦИЯ
Ключевые слова:
пандемия коронавируса,
авиационная
промышленность,
новые перспективы,
антикризисные меры,
воздушный транспорт,
государство.
В
статье
дан
анализ
влияния
предпринятых
антикризисных
мер
на
основе
анализа
объемов
перевозимых грузов, охарактеризованы проблемы отрасли
в сложившихся обстоятельствах, вызванные пандемией
коронавируса в мире. Сформулированы конкретные меры
по смягчению негативного влияния на развитие экономики.
UNWTO strongly stated “Stay at home today. Start tomorrow”. Containing the
pandemic is our top priority, and tourism is committed to supporting all measures taken
to contain the outbreak. However, these measures have led to the fact that the tourism
sector has become one of the most difficult to access, and this has huge consequences for
the economy of the whole world [1]. Tourism is an economic engine and one of the main
pillars of supporting global growth and development. It accounts for 30% of global service
exports and 1 for every 10 jobs in the world. Regardless of the economic classification of
low–, middle – or high-income countries, the contribution of tourism is multi-level and
cross-sectoral [2]. It is also a vital source of employment, especially for women and youth,
as well as income from tourism and foreign direct investment. The closure of the external
and internal borders in March this year not only reduced the revenues of tourism
companies to zero, but also led in some cases to significant losses. Many companies in the
country face the threat of bankruptcy of hotel, transport, as well as catering, sightseeing
and consulting services in the field of tourism[3].
At present, worldwide, the spread of the COVID-19 coronavirus infection has caused
a number of problems, not only with domestic contractual relations, but also greatly
affecting foreign trade and foreign economic relations between foreign partners [4], as
well as the transport industry through air transport.
Despite the fact that COVID-19 coronavirus infections were spread all over the
world at the beginning of 2020, foreign economic contracts have not stopped, but their
volume has decreased. Although there were problems associated with the inability to fulfill
obligations under previously concluded foreign economic contracts. This, in turn, has also
had a significant impact on the foreign economic relations of many countries due to the
established internal restrictions [5] in various sectors and, of course, in aviation, a sharp
decline in their revenues, in particular restrictions on flights to carry passengers and
luggage. All this shows the need for special attention in this sector.
Losses in the volume of passenger and cargo transportation within the republic and
beyond its borders can undoubtedly significantly slow down the growth of the economy of
Uzbekistan. During the antiviral measures, an anti-crisis fund [4] was created to support
entrepreneurship, infrastructure projects, and the leading sectors of the republic’s
economy, including tourism and transport. As a priority measure, a commission has been
established in Uzbekistan to study the situation in the country and abroad in connection
with the spread of this type of coronavirus [6].
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According to forecasts of experts in the tourism industry of Uzbekistan, losses
amounted to up to 31 million US dollars [7], all this led to the idleness of the country’s
aviation sector and to large financial losses, both for the state and for the private sector. In
order to prevent bankruptcy, the sector was provided with a number of preferences: debt
on loans without accrual of penalties, revision loan repayment schedules for Uzbekistan
Airways JSC, exemption from payment of land tax and property tax, and payment of social
tax at a reduced rate of 1 percent [8].
When analyzing the main indicators of transport for the 1st quarter of 2020, the
dynamics shows a decrease in traffic volumes due to the restrictions imposed by some
countries on air traffic in transit traffic – 52.5%. For example, in the 1st quarter of this year,
indicators for air (export and import) modes of transport had a stable growth rate
compared to the same period last year, then already in 20 days of April in the peak
quarantine period, there is a sharp decrease in all types of communication [9]. Most
countries in the world have imposed restrictions on air traffic, due to a sharp drop in
passenger traffic and non-payment of airlines and tenants, airports lose 90% of revenue,
while costs remain unchanged. These and other factors make the aviation industry one of
the most vulnerable in the face of the economic crisis due to the coronavirus pandemic in
the world.
One hundred and ten countries significantly restricted air traffic, which accounted
for about 98% of the aviation market. Passenger traffic recovery forecasts are pessimistic.
There are many reasons for such pessimism in forecasts. COVID-19 has caused a global
economic recession, a decline in international trade that will affect the airport industry.
Business activity went online due to quarantine, in addition to this, business will cut travel
budgets in the future. The growth of passenger traffic will also be constrained by the
requirements for observing the distance between passengers in the terminal and the plane,
new visa restrictions, as well as concerns of the passengers themselves [10].
Airports formed a consolidated industry position on the package of measures and
turned to the government for support. The set of measures includes state guarantees for
the ten largest airlines to fulfill their obligations for the period from April 1 to December
31, 2020, full or partial subsidies for the cost of airport services and fuel complexes for
airlines, the abolition of rent for the use of state airfield infrastructure for 2020, and also
tax deferrals and incentives, financial incentives for staff retention, and suspension of
dividend payments to the government where applicable [11].
A number of states have released amounts equal to 11% of GDP to support the
economy, a considerable part of which is to support the airport industry. Canada released
US $ 331 million to support the airport industry, US $ 58 billion, Singapore US $ 7 billion,
New Zealand US $ 4 billion, etc. [12].
The most effective measures to support the airport industry are tax incentives and
government guarantees. KPMG experts named the most effective and most feasible
measures to support the airport industry. In their opinion, such measures are tax
incentives for the industry and the provision of state guarantees to independent players in
the industry, primarily airlines. When passenger traffic begins to recover, this will help
overcome the crisis of confidence in the industry and gain the highest possible pace for the
situation [13].
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In order to improve the quality of passenger service and ensure flight safety, over
the past few years, the national aircraft fleet has been replenished with new modern
aircraft “Airbus” and “Boeing”. With the involvement of experts from the World Bank, the
work on the distribution of functions for air transportation and airport operations
between independent enterprises was completed on the basis of international best
practices. In October 2019, the reorganization of the NAC “Uzbekiston Havo Yollari” was
carried out. The independent companies “Uzbekistan Airways” and “Uzbekistan Airports”
were created.
In order to further liberalize the aviation market and expand the geography of
flights, from October 2019, the “Open Skies” regime was introduced at the international
airports of Karshi, Nukus, Termez and Bukhara. However, we note that the introduction of
the “open skies” regime in itself is not a key factor in the immediate increase in the number
of foreign flights and the rapid growth of passenger traffic.
It is expected that the measures taken will increase the attractiveness of the aviation
sector of our country for foreign air carriers. The construction of a new passenger terminal
and a runway of the Samarkand International Airport is envisaged, which will increase the
airport’s capacity from 500 passengers to 1500 passengers per hour. As a result of the
optimization and reconstruction of the Tashkent International Airport with the
participation of German specialists, the airport’s capacity will be increased from 4 million
to 7 million passengers per year. The construction of a new runway at the Termez
International Airport and the reconstruction of the Andijan International Airport will also
provide the ability to service all types of aircraft and increase the number of flights by 2-3
times [14].
In our opinion, over the past 30 years, there have been practically no reforms in this
industry. As a result, serious problems and deep contradictions have accumulated. Not
enough attention was paid to the development of the industry; it developed on the
principles of monopoly in the absence of competition. As a result, we see high rates and
insufficient quality of services provided.
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