A line of airplanes are parked at Incheon International Airport. (Yonhap)
SEOUL, May 4 (Korea Bizwire) – The government has decided to pre-purchase airline tickets in a bid to help the airline industry, which is suffering from the prolonged outbreak of the new coronavirus.
The Ministry of Land, Infrastructure and Transport said Sunday it has signed a business agreement with airlines and decided to prepay 15.5 billion won (US$1.26 million), or 85 percent of the ministry’s overseas travel expenses, for air ticket purchases.
In an earlier emergency economic meeting held on April 8, the government decided to bolster sluggish domestic demand resulting from COVID-19 and chose to pay for air tickets in advance as one of its priorities.
The estimated volume of air ticket pre-purchases totaled 160 billion won, equivalent to 80 percent of the government’s budget for airfare.
In response, the transport ministry arranged procedures and systems such as preparing guidelines for the sale of air tickets and drawing up a standard agreement between agencies and airlines.
Later, all public sectors, including the central government, local governments and public institutions, plan to step up their efforts to purchase airline tickets in advance by the end of June.
Agencies that purchase tickets in advance will then deduct the airfare from the actual travel arrangements and ticketing.
Considering the different types of business trips and locations of business trips, the airline and the prepayment amount will be decided by each institution.
In addition, in case of short-range business trips, government agencies have been advised to pre-purchase tickets from low-cost carriers.
Airline will be required to refund any outstanding prepayments to the relevant agency by the end of this year and must get warranty insurance in order to do so.
D. M. Park (dmpark@koreabizwire.com)
