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UK GDP faces US$14b impact from closed US air links

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The closure of passenger air links between the US and the UK will strip at least 11 billion pounds (S$19.66 billion) off UK gross domestic product in 2020, according to a report commissioned by British Airways' parent IAG SA, London's Heathrow Airport, the Airlines UK trade group and airport services firm Collinson Group.

[LONDON] The closure of passenger air links between the US and the UK will strip at least 11 billion pounds (S$19.66 billion) off UK gross domestic product in 2020, according to a report commissioned by British Airways' parent IAG SA, London's Heathrow Airport, the Airlines UK trade group and airport services firm Collinson Group.

The authors called for the creation of city or state-based travel corridors between the US and the UK as well as airport testing for Covid-19. Keeping the routes closed will cost the UK economy 32 million pounds a day by the beginning of October, according to the report.

"Government inaction on aviation and its impact on Britain's economy couldn't be clearer," British Airways Chief Executive Officer Alex Cruz said. "Ministers must reach agreement with their US counterparts on a testing regime that minimises quarantine and permits regional travel corridors to re-open the UK-US market." Airlines have been campaigning to lift restrictions on trans-Atlantic travel which have been in place since early March. New York to London is BA's most profitable route, with business travel a key driver of demand. The route generated about 7 million seat sales last year. The US is the single biggest source of visitors to the UK, with almost 4 million people visiting annually, according to the report.

While the US currently doesn't allow non-citizens who have spent any of the previous 14 days in the UK or Europe to enter, the UK mandates a 14-day quarantine on incoming travellers from the US The Covid-19 pandemic has reversed decades of growth in the aviation industry, shutting down flights and triggering a slump that could see traffic diminished for years.

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