LOT to continue operations although staff cuts likely

National air carrier LOT will be able to continue its daily operations, after the government agreed to provide it with a $1 billion insurance guarantee. The company asked for public assistance after its insurers reacted to the recent terrorist attacks on the US by reducing their maximum cover from $2 billion to just $50 million. Without the government's help, LOT would have had to suspend all its flights, starting from 1 am yesterday. The guarantee will be in force until October 31, giving the new government sufficient time to consider the matter and seek parliamentary approval of its recommendations. The current government's insurance guarantee will not, however, solve all the company's problems. Facing a 10% fall in demand for its services, LOT will almost certainly have to reduce its staff and p robably also suspend operations on some routes. (Prawo i Gospodarka, p. 5; Gazeta Wyborcza, p. 21) M.K.