Cathay Pacific needs larger government policy shifts to spur recovery

The Hong Kong government is continuing to take incremental steps to ease entry requirements for travellers, which is allowing Cathay Pacific to raise capacity gradually.

However, the airline stresses that far more policy moves are still needed before it can undertake a significant capacity recovery. The latest actions by the government have reduced quarantine requirements and removed some punitive route suspension rules.

Cathay Pacific has welcomed such steps, but it has also issued its most vociferous call yet for the government to produce a road map for the removal of remaining restrictions.

There are two strands to the problem: entry restrictions deter travellers and make it difficult for Cathay Pacific to fill planes and generate revenue; operational restrictions stretch Cathay Pacific's staff resources and limit its ability to add more capacity.

Until both facets are addressed, Cathay Pacific's recovery rate will remain anaemic.