The International Air Transport Association (IATA) said today European governments' response to the volcano crisis was inadequate and estimated its economic impact to be greater than the September 11th attacks.
Giovanni Bisignani, head of the IATA airline industry body, estimated airline revenue losses were now reaching $250 million a day, up from an earlier estimate of $200 million on Friday.
Mr Bisignani called for urgent action to safely re-open airspace and called for a meeting of the International Civil Aviation Organisation, the United Nations aviation body.
"We must move away from this blanket closure and find ways to flexibly open air space, step by step," Mr Bisignani told a news briefing in Paris. "We have to make decisions based on the real situation and not on theoretical models. They (the authorities) have missed opportunities to fly safely."
Meanwhile, Germany said it will not offer state aid to airlines for losses caused by the Icelandic volcanic ash cloud.
"I will resist any call to the state," German transport minister Peter Ramsauer said in a radio interview, adding that airlines knew they were dependent on the weather. Mr Ramsauer said it was unclear what economic consequences the ash cloud would cause in general.
"Aside from the sectors that have been hurt by this, we have other sectors that have profited from it significantly".
The minister reiterated that passenger security was an absolute priority and rejected criticism from airlines that authorities were not paying enough attention to test flights carried out to assess the safety of flying. "It would be cynical and I could not politically make a case for weighing revenue losses against security."
Main German carrier Lufthansa and second-biggest airline Air Berlin yesterday criticised airline authorities for not taking more account of the results of their test flights.
Lufthansa chief executive Wolfgang Mayrhuber said in an interview with state television yesterday evening that he did not think the ash cloud posed any serious danger.
"No one wants to fly through a volcanic ash cloud. But what we have seen in the past few days is anything other than a serious danger," he said.
British prime minister Gordon Brown said European funds should be made available to compensate airlines and other travel firms who have lost millions of dollars in revenue.
"I believe that this is one of the most serious transport disruptions that we have faced," Mr Brown told reporters.
"It's got financial consequences as well as human consequences and we will do everything in our power to make sure all the arrangements are in place to help people where possible to get back home."
Mr Brown said he had held talks with European Commission President Jose Manuel Barroso about helping out airlines and travel companies who have suffered from the airspace paralysis.
Goldman Sachs Group said Europe's economy would be hurt by a sustained disruption to air travel caused by last week's Icelandic volcanic eruption.
"If this were to continue for a longer time, then it would surely start to have a significant effect," said Erik Nielsen, chief European economist at Goldman in an e-mailed note. For now, "if the disruption to air traffic is contained to a week or less, then I think the total effect will be minimal."
Agencies