The Cabinet has extended the repayment date of Estonian Air's 37-million-euro rescue loan.
The new deadline is set for 2018 at the latest, or alternatively whenever the European Commission delivers a decision on the government's proposed restructuring plan for the company, which could take several years.
In February, the government agreed to issue the airline a loan in installments. Additionally, the government has proposed a 40.7-million-euro bailout for the restructuring plan that the European Commission is in the process of reviewing.
Last year, the company reported having accumulated massive losses, leading to the firing of its former CEO, as well as major cuts in staff and fleet. The government has resisted bankrupting the carrier, however, saying its operations are of national importance.