PARIS: The EU authorised the French government on Tuesday to double its stake in Air France and inject up to four billion euros into the struggling airline whose revenues have been hit by the pandemic-induced drop in passenger traffic.

The agreement, worth $4.7 billion, follows weeks of negotiations with the EU commission, which must ensure that state aid does not give companies an unfair advantage. Air France posted a 7.1 billion euro ($8.4 billion) loss in 2020 as its business, like that of the rest of the world’s airlines, suffered from coronavirus restrictions which all but grounded global air traffic.