The Airport Authority announced a relief package of HK$450 million to assist airlines and other operators whose business at Hong Kong International Airport has been adversely affected by the global economic downturn.

The relief package comprises $200 million worth of reductions in charges and $250 million interest-free, deferred payments, starting April 2009.

Airlines operating at HKIA are being offered a 10% reduction in both landing and parking charges till the end of 2009, amounting to savings of about HK$200 million. Also, to alleviate cash flow issues during the recession, 50% of rental payments for airline lounges, office premises, counters and storage can be deferred for up to one year and repaid by interest-free installments from April 2010 onward. If all business partners apply to defer 50% of their rental payments, the total amount will reach approximately $250 million.

The majority of retailers and caterers at HKIA pay the AA a licence fee according to a mechanism that allows fee adjustments based on airport passenger volume. According to the mechanism, licensees pay less as passenger throughput declines. The average licence fee has dropped by about 4% over the last few months.

Stanley Hui Hon-chung, Chief Executive Officer of the Airport Authority, said that HKIA has been suffering from the flagging global economy. At HKIA, traffic volumes started declining in August 2008, with the first quarter of 2009 showing year-on-year decreases in passenger throughput, cargo volume and aircraft movements of 7.1%, 22.8% and 6.6%, respectively.

In response, the AA began implementing a series of cost control measures—including headcount freezes—in the last quarter of 2008. According to Mr Hui, the AA will stay vigilant on costs as the economic slump continues.Mr Hui said, "The operating environment facing the global aviation industry is expected to remain challenging for the rest of 2009. We intend to ride out the recession with our business partners by introducing relief measures that are reasonable, responsive and within our means.

"The reduction of both landing and parking fees will help airlines at HKIA reduce operating costs," explained Mr Hui. "Meanwhile, the ability to defer rental payments will help our business partners deal with liquidity issues in a troubled operating environment.  We hope the relief measures will help airlines better able to maintain their flight schedules at HKIA in support of our efforts to maintain HKIA as a regional and international aviation centre."

Mr Hui added that the relief package was introduced after consulting with various airline industry representatives, and that the AA would continue to maintain dialogue and work side by side with its business partners.

In 2000, the Airport Authority reduced both landing and parking charges at HKIA by 15%. The reduction has remained effective since then.