ECONOMY

Gov’t hits back after German firm seeks more guarantees for airport deal

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In the wake of reports that German firm Fraport has sought additional guarantees before undertaking the operation of 14 Greek regional airports, a Greek government official said on Wednesday that any renegotiation of the deal must be comprehensive and not focus exclusively on the issues raised by the firm.

The completion of the concession of 14 regional airports, without any changes to the terms agreed with the previous government, was a condition of the agreement of the eurozone leaders’ summit of July 12, the Greek official said. The government has “honoured absolutely” the terms that were agreed to and on August 18 a decision confirming the government’s intention to move forward with the deal was published in the Government Gazette, he said. 

If the company leading the consortium wants to renegotiate the contract “the renegotiation should not be limited to the Issues raised by the firm but should be comprehensive,” the Greek official said.

Germany’s Fraport and Greek energy firm Copelouzos had agreed with the Greek privatiation agency last year that they would run the 14 airports around the country.

Under the terms of the deal, the German-Greek group was expected to spend about 330 million euros in the first four years to upgrade the airports, which would be leased for 40 years.

However, Kathimerini understands that the consortium is asking for more guarantees from the Greek government following the uncertainty of the last few months. The group is also facing greater financing costs due to the higher country risk associated with Greece.

This has raised doubts about whether Greece will able to reach its bailout target of receiving 1.2 billion euros from the agreement by the end of the year.

“The Greek government’s decision is not tantamount to the conclusion of a contract but rather offers a basis for the resumption of negotiations,” Joerg Machacek, a Fraport spokesman, told Bloomberg on Tuesday. “We are building up from where we left off.”