Dubai: Etihad Airways said on Thursday that loans from the Abu Dhabi government do not amount to government subsidies, responding to an Australian media report that the Abu Dhabi ruling family is propping up the airline.
“We have received financial support from our shareholder, in the form of equity capital and shareholder loans, which is perfectly normal for any start-up business,” an Etihad Airways spokesperson told Gulf News in an emailed statement.
Etihad had access to a long-term interest free $3 billion (Dh11 billion) loan from the Abu Dhabi ruling family, that does not require payment until 2027, the Australian Financial Review reported on Wednesday citing leaked documents that have since been published online.
Tensions
Etihad declined to comment on the specific details of Wednesday’s report including the $3 billion loan, the airline however, affirmed that it “is a business which operates under a strict commercial mandate” that does “not receive Government subsidies”.
Revelations of the secret interest free loan are likely to fuel tensions among rival carriers that have long accused Etihad — and other Gulf airlines — of operating on an uneven playing field.
A number of airlines, including Qantas, Lufthansa and Delta, have blasted Etihad and other Gulf carriers, Emirates and Qatar Airways, in the past accusing them of being propped by government coffers.
Etihad — and the other Gulf Carriers — have long denied these claims.
(With input from Reuters)
