All EX-YU carriers to receive state support in 2020
The three remaining flag carriers from the former Yugoslavia - Croatia Airlines, Air Serbia and Montenegro Airlines - will all receive state funds next year, each exceeding twenty million euros.
Croatia Airlines will be the beneficiary of the second instalment of the government’s 33.7 million euro cash injection, aimed at stabilising the carrier prior to its privatisation, which is being targeted for June 2020. The airline will receive 20.2 million euros next year which will go towards aircraft maintenance, debt and loan repayments, as well as other essential investments. The flag carrier’s CEO, Jasmin Bajić, said last week, “In the third quarter we had a profit of 41 million kunas (5.5 million euros). That’s the reality for Croatia Airlines - in winter we lose money, while in the summer, when competition is at its peak, we are profitable. We need to find a solution for the winter months when we are practically the only carrier connecting Croatia to the world”. Next year, the company is also expected to benefit from greater funding for Public Service Obligation (PSO) flight contracts for the upkeep of its domestic network. It currently receives 10.3 million euros in compensation per year from the European Union. The figure is expected to be revised up from late March 2020 once a new four-year contract comes into force.
The Serbian government has approved a draft of the country’s state budget for 2020 which foresees subsidies for Air Serbia. Although the exact amount of funds has not been specified, the national carrier is one of 63 companies “of special importance“ which will share eighty million euros in subsidies among themselves. The airline was the beneficiary of 20.8 million euros "from premiums, subsidies, grants and donations" both in 2017 and 2018. In addition, Air Serbia will pocket five million euros for subsidised operations out of Niš and is widely tipped to launch operations from Kraljevo, which will be incentivised by the government to the tune of 2.7 million euros in 2020.
Late last week the Montenegrin government allocated 21 million euros for Montenegro Airlines in 2020. The Montenegrin Minister for Finance, Darko Radunović, said the funds would be used to help the company become sustainable in the future. “We have witnessed significant state protectionism in recent times and we should notify the public of it. In the region, we have the example of Croatia Airlines and in Germany the case of Thomas Cook. We simply have to recognise the importance of certain companies which serve the public interest and contribute to the state budget”.
0 Response to "All EX-YU carriers to receive state support in 2020"
Post a Comment