In November 2020, Air Europa signed a public financing contract with the State Company for Industrial Participations (SEPI), which has been instrumental in helping the airline survive the challenges posed by the Covid-19 pandemic. The aid, amounting to 475 million, was the largest granted by the Fund to Support the Solvency of Strategic Companies (FASEE).
The conditions of the aid were demanding, with strict guarantees required from Air Europa’s owners, the Hidalgo family. The SEPI demanded extensive guarantees from the family to secure public funds. The loans included fixed and variable interest rates, with strict repayment terms.
However, allegations have emerged linking President Pedro Sanchez’s partner, Begoña Gomez, to favorable treatment towards Air Europa in securing public support. These allegations have been refuted by members of the Executive. A complaint has been filed against Begaña Gomez for alleged influence peddling, which is currently under investigation. The President has responded to these allegations by suspending his agenda and considering a possible resignation.
Despite these challenges, Air Europa has managed to sustain its operations with support from other financing sources as well as SEPI’s involvement in its management. The SEPI has representation on Air Europa’s board and approval for key decisions relating to its operations. The company’s financial struggles have necessitated tough decisions and close oversight from the government to ensure its survival. However, it remains crucial for both Air Europa and SEPI that their partnership continues in order for Spain’s aviation industry to thrive.
It is worth noting that while this type of aid is essential for some companies facing financial difficulties during challenging times like these, it also raises concerns about potential conflicts of interest and accountability issues when large sums of public money are involved. It will be important to closely monitor any future developments related to this case and ensure that all parties involved adhere to ethical standards and best practices in managing public funds.
In conclusion, while there are certainly challenges ahead for both Air Europa and SEPI in navigating their partnership through this difficult period, they can take comfort in knowing that they have each other’s support and resources available as they work together towards a sustainable future for Spain’s aviation industry.