The Rwanda government has said it will increase funding to the national carrier RwandAir to 145.1 billion Rwandan franc ($155m) in the 2020-21 fiscal year, up from 121.8 billion Rwandan franc ($130m) this financial year.
The increased transfers to the carrier are meant to facilitate the airline to respond to the impact of the COVID-19 pandemic.
The funds are also meant to facilitate the airline to continue its expansion process, including the acquisition of new planes and new routes.
RwandAir has been affected by the pandemic due to the travel bans countries have imposed on travellers across the world.
The airline suspended all commercial flights when Rwanda barred all commercial airlines to enter the country.
RwandAir has employed drastic measures including reduction of salaries of employees in an attempt to avoid layoffs. The company reportedly put on hold contracts of some pilots and non-essential staff until further notice.
Rwanda’s Minister for Finance and Economic Planning, Uzziel Ndagijimana, said that the transport sector is among those sectors hit the hardest.
Last year, 12% of transport services grew 12% boosted mainly by a 17% increase in air transport activity.
However, the sector is expected to contract by 1.9% in 2020.
The increased funds could help the airline overcome the negative impact exerted by the new coronavirus pandemic.
The government has set aside 240.4 billion Rwandan franc ($256.8m) for the transport sector.