Saturday October 25, 2014 Search
Weather | Athens
19o C
12o C
News
Business
Comment
Life
Sports
Community
Survival Guide
Greek Edition
Concern over usage cost of privatized airports

By Alexandra Kassimi

The ongoing privatization process concerning Greece’s regional airports carries the inherent risk of leaving the country with dozens of expensive small terminals.

The government’s plan to abolish the existing airport tax and replace it with a new levy whose level is yet to be determined initially appeared satisfactory to the air industry, whose officials thought that would have spelt the end of the infamous charge. However as things are shaping up, and as long as the actual level of the new levy remains up in the air, concerns are on the rise.

Notably, the companies participating in the regional airports’ sell-off procedure are keen to find out the rate of the levy so they can draft their sustainability reports.

The privatization timetable foresees the binding bids for regional airports being submitted by the end of June, although no one can rule out a tender extension.

The law foresees the new levy apply both to Athens International Airport (AIA) and the privatized terminals, whose cost of use will likely increase considerably. At the same time foreign air companies active in Greece stress that the lack of clarity in the privatized airports’ terms of operation could generate considerable problems.

Concerns over the level of the new charge stem from the expenditure it will have to cover: According to the law concerning the sell-off of regional airports, the new levy will need to fund the operational costs of the airports that will remain in state hands, otherwise they will have to shut down.

Still, it remains unclear how many of the country’s airports will be privatized, meaning that the calculations to work out the extent of the new charge cannot be made. Of the country’s 37 airports, estimates suggest that between 13 and 22 could pass into private hands. For the same reason, it is also unknown how many terminals will continue to require state funding or how much money the new tax will bring in. In addition, the new charge will also have to cover the funding of so-called unpopular routes to remote parts of the country that are subsidized by the state.

The law provides for the level of charges to be monitored in a bid to avoid a repetition of the phenomenon seen at AIA, which has particularly high usage costs. It also puts a limit on the profit margin from air revenues that contractors would not able to exceed. Both provisions have predictably met with strong reactions from prospective investors.

Developments are also expected in AIA’s privatization process. Sources say that the interested investors will submit their offers in early 2015. In the meantime state sell-off fund TAIPED is expected to ask Canadian fund PSP Investments, which holds a 26.7 percent stake in AIA and its management, to inform Athens whether it intends to increase its holding.

According to sources, candidate investors will reserve the option of signing a contract based on the current one that expires in 2026, which will also include an extension option, as the state requires. The period up to 2026 is considered too short for a company to make any substantial investments, therefore there is a strong likelihood that the AIA investment will come with the extension of the current contract.

ekathimerini.com , Monday June 16, 2014 (20:48)  
TAIPED waits for green light from Eurostat
Trade deficit shrinks on big drop in imports
SMEs unable to claim subsidies
Taxes kept growing in second quarter
Athens, Nicosia satisfied by EU leaders´ stance toward Ankara
A reference in Friday’s European Council conclusions calling on Turkey to respect Cyprus’s sovereign rights left Athens and Nicosia content with the outcome of the European Union leaders’ su...
Suspended policeman chief suspect in cousin’s murder
A 27-year-old police officer who has been suspended from duty since 2013 for extortion, is being treated as the chief suspect in a murder committed in a suburb of Piraeus on Thursday. Police...
Inside News
BASKETBALL
A win is a win is a win for Olympiakos
A bad Olympiakos defeated a worse Laboral Kutxa 63-57 to make it two out of two in the Euroleague on Friday. In a game where the two teams had an overall field goal rate of about one in thre...
SOCCER
Panathinaikos snatches point at Eindhoven
Panathinaikos offered its fans a glimpse of its glorious past in European competitions snatching a draw at PSV Eindhoven, on an otherwise bad night for Greek soccer in the Europa League, as ...
Inside Sports
COMMENTARY
Tension for tension’s sake?
It is evident that Turkish President Recep Tayyip Erdogan feeds off tension. He would barely have achieved as much as he has – and prevailed – if he had not been so keen to confront a series...
EDITORIAL
Testing ground
The Regional Authority of Attica is a good testing ground for politicians who appear to thrive on accusations to prove whether they can actually solve major problems of a practical nature. T...
Inside Comment
SPONSORED LINK: FinanzNachrichten.de
SPONSORED LINK: BestPrice.gr
 RECENT NEWS
1. A win is a win is a win for Olympiakos
2. TAIPED waits for green light from Eurostat
3. Trade deficit shrinks on big drop in imports
4. SMEs unable to claim subsidies
5. Taxes kept growing in second quarter
6. Thessaloniki Port expects 2014 to be record year
more news
Today
This Week
1. Woman killed in tram accident in Floisvo, south of Athens
2. Clocks to go back 1 hour on Sunday
3. Venizelos slams Turkey for 'flagrant violation of international law' off Cyprus
4. ECB vies for third time lucky in European stress tests
5. ECB bank assessment to show 6-billion-euro capital gap, Citi says
6. Cyprus GDP upgrade seen as boosting bailout exit plans
Today
This Week
1. The past, present and future of the Greek debt crisis
2. Greece’s closed society is central to its current malaise
3. Greece must stick to reforms, says Schaeuble
4. At least 11 banks to fail European stress tests, three in Greece, report says
5. Cyprus to block Turkey's EU talks after EEZ violation
6. Samaras’s crumbling Greek exit lacks backing from economists
   Find us ...
  ... on
Twitter
     ... on Facebook   
About us  |  Subscriptions  |  Advertising  |  Contact us  |  Athens Plus  |  RSS  |   
Copyright © 2014, H KAΘHMEPINH All Rights Reserved.