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Business counts cost of ash cloud

Ripples of flight ban reach far beyond airlines and tourism
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The international airline industry lost an estimated €1.3 billion, according to industry representative body IATA, with the big companies losing €300 million a day on Saturday and Sunday at the peak of the crisis. Brussels Airlines said the flight ban had cost it “millions of euros a day”. The estimate was based on the cost of the grounding of flights in winter, which ring in at €9 to €10 million a day. “And that’s just for a few hours a day, not the complete suspension of all air traffic,” said Brussels Airlines spokesman Geert Sciot.

The shutdown has had tougher economic effects than September 11, and the sector has called for government help. Giovanni Bisignani of IATA described the lack of government reaction as “shameful”.

In the hotel sector, meanwhile, April is the number one month for conferences and conventions, and the flight ban saw cancellations running at 20% of bookings – an effect that may continue to be felt even after the ban is lifted.

According to Unizo, which represents the self-employed, one in three businesses in Flanders is suffering some fallout from the ash cloud. Six businesses in 10 had workers or managers stranded offsite, while four in 10 had problems with receiving from suppliers and the delivery of their own goods and services. Unizo set up a 24-hour Service Centre to advise businesses on dealing with problems raised by the situation.

In Antwerp, the import and export of diamonds was brought to a standstill by the flight ban, but the trade in stones carried on within the city, the Antwerp World Diamond Centre said. Diamonds are forever, but the mango season only started three weeks ago, and mangoes are highly perishable. Daily shipments are flown into Belgium every day from the Ivory Coast, but they were left to rot on the tree during the flight ban. A similar fate awaited green beans from Morocco and lobster from Canada.

Meanwhile, Belgian endives and peppers failed to make it to Canada, and meat could not be sent to Dubai. Specialist suppliers described the situation as “disastrous”. Starfruit, a company specialised in exotic fruit, said there were problems with passion fruit, lemongrass, baby maize, figs and papayas – which will probably lead to higher prices in the weeks to come.

However, there were positive aspects to the flight ban. The reduction in CO2 from having no planes in the air may only amount to 2%, but the lack of planes was a boon to migratory birds, particularly those who fly at great heights, where they are often involved in collisions with aircraft – known in the aviation industry as “bird strikes”.

(April 28, 2010)