The Latvian parliament, the Saeima, has approved in an extraordinary session an urgent law that allows the state to bail out the country’s ailing national airline, airBaltic, LSM reports. The law, which was rushed through parliament in just one day, will allow the government to acquire around EUR 30mn of more airBaltic bonds. Also, the law will allow to postpone the repayment of an emergency state loan issued to airBaltic, capitalise claims on the company’s loans and bonds, and provide interim financing to the company, LETA reports. The law passed with support from the opposition Progressives, while the Union of Greens and Farmers (ZZS), which is part of the current four-party coalition government, voted against.
Prime Minister Andris Kulbergs insisted that the state should not be involved in the aviation business. However, he said that airBaltic should have a “last chance,” given that the company accounted for 1.5-2% of Latvia’s GDP, LSM reported. At the same time, he noted that the state had effectively lost control of the company, which was now in the hands of lenders, ERR reported. Meanwhile, Kulbergs suggested that the Baltic States consider the possibility of establishing a joint airline, LETA reported. Lithuanian Prime Minister Mindaugas Sinkevicius said that Lithuania would consider any offer to buy into airBaltic, The Baltic Times reported. However, Transport Minister Juras Taminskas rejected the idea, insisting that airBaltic’s troubled finances must be addressed by the Latvian government, BNS reported.
Vitolds Jakovlevs, CFO and member of airBaltic’s board, said that the company’s new business plan would reduce its capacity by about 10%, LSM reported. The company would balance summer capacity with winter capacity, thus increasing route efficiency, he explained. Jurgis Sedlenieks, deputy chairman of airBaltic’s supervisory board, assured that while the company’s main base would remain in Riga, the airline would continue to offer flights from Tallinn and Vilnius as well. Earlier, airBaltic suspended flights from Tallinn to London, from Vilnius to Berlin and Dubai, and from Palanga to Tenerife for the winter season of 2026/2027, ERR and LRT reported. Meanwhile, the Latvian Aviation Union (LAA) demanded social guarantees for airBaltic employees who could potentially be laid off, LETA reported.