China's restrictions on international flights could last to 2022

[HONG KONG] China's top three airlines told analysts the government's tight restrictions on international flights could last into the first half of next year due to Covid-prevention measures ahead of the Beijing Winter Olympics in February, HSBC Holdings said.

The continuation of curbs means a full international travel recovery is not likely until 2024, analysts including Parash Jain wrote in a note after briefings with Air China Ltd, China Southern Airlines Co and China Eastern Airlines Corp following the trio's recent results.

When reopening does occur, it will likely begin with Singapore, South Korea and other places with high vaccination rates, HSBC said, citing the carriers.

China's so-called Five One policy essentially limits airlines to just one international flight a week, while passenger capacity is capped at 75 per cent. Foreign carriers can also operate only one flight a week to China.

The three Chinese airlines all suffered hefty losses in the first half of 2021, though the figures were an improvement from a year earlier thanks to a recovery in domestic demand.

The domestic rebound stalled in subsequent months due to fresh Covid outbreaks, though they have now been brought under control.

BLOOMBERG