Greek travel agents have joined forces with Elena Kountoura, Alternate Minister for Growth, in charge of tourism policy, in attacking budget air carrier Ryanair, after its chief commercial operator announced the wrap up of flights to Greece two months earlier than originally planned. Tourism officials accuse the carrier of blackmailing practices and have expressed their outrage for the CCO’s “insulting” attitude towards the Greek tourism industry.
It began with an interview given by David O’Brien, the Irish budget air carrier’s CCO, to Sunday newspaper To Vima, in which he announced Ryanair is about to cut short its summer season flights to Greece in the low season – two months ahead of schedule – starting with the island of Kos. This decision comes as a drastic measure on the part of Ryanair, after the Greek government refused to take into consideration the air carrier’s suggestions to reduce taxes. In his interview, Mr O’Brien proceeded to attack the Minister of Tourism, Elena Kountoura, predicted that the sale of regional airports to the German airport management company Fraport will destroy tourism, and expressed his frustration with the air-controllers’ strikes.
This has not been Mr O’Brien’s first attack on the Greek government, which he called “lunatics and nutters” in his previous attempt to ask exemption from Athens Airport taxes and fees. This time, it’s the €12 departure tax that has the CCO fuming.
In his interview, he claimed that Ryanair has sent 25 letters to the ministry in the last two years, receiving only three replies. In his letters, Mr O’Brien had suggested that the Greek government should slash the Athens International Airport taxes by five per cent, and exempt small airports (i.e., those in the Greek islands) from the Airport Modernisation and Development Levy, which amounts to €12 per passenger, for five years, promising in return an additional five million passengers coming to Greece. “It is better to have passengers without taxes, than taxes without passengers,” he said.
He then went on to predict that Fraport is set to create a cartel, applying the same fees across the Mediterranean, further worsening touristic prospects in the 14 regional Greek airports it manages, stating: “The Germans will increase the infrastructure that outside the high season will be empty. Then, as a monopoly, will raise fees for airports. They will destroy island tourism, attracting more tour operators only for two months, whereas what the islands really need is to have more passengers for a longer period.” Expressing his bewilderment at the Greek government’s lack of interest in Ryanair’s proposals to increase visitors, he implied that the real cause is fear of its German partners. Describing Deputy Tourism Minister Elena Kountoura as the ‘Marie Antoinette of Greece’, due to her lack of response to his suggestions, the CCO went on to dismiss the ministry’s tourism policy. “Speaking on public television, she just said it was a social tourism program, which is excellent for beneficiaries, but the tourism strategy can not be limited to the recycling of money of Greek taxpayers,” Mr O’Brien said.
THE TOURISM INDUSTRY COUNTER-ATTACKS
On her part, Elena Kountoura admitted that Ryanair has requested from numerous governments a reduction of the airport levy and to cut it altogether for the island of Kos, but has repeatedly explained that such a decision lies less with the Ministry of Tourism than that of Finance and Transport, which has the authority to amend tax policies.
“I have previously thanked Ryanair’s representative and I thank him once again publicly for his intention to bring an extra five million passengers to Greece in the next few years. And of course, I stressed that I support any action that makes tourism in our country more competitive,” she said.
Less diplomatic has been the response of the Greek tourism industry representatives. In a statement released to the press, Lysander Tsilidis, president of the Federation of Greek Associations of Travel and Tourism Agencies (FEDHATTA), dismissed Mr O’Brien’s claims as “unacceptable, offensive and blackmailing”. FEDHATTA accuses Ryanair of disrespect to the country’s institutions, claiming the air carrier is trying to determine legislation in accordance with its interest. “The only thing the company has not asked yet is to govern the country,” the industry’s union states. “Instead of being grateful for being active in our country, indirectly aided financially by municipalities and regions, for several years now, to arrange schedules that generate their company’s profit and growth, they shamelessly exploit conjectures, arising from economic and other events, and blackmail with flights’ reduction, essentially to achieve even more favourable commercial conditions.”
Ryanair has often proceeded in this kind of intervention. The carrier is currently in friction with the air traffic controller’s union in France, regarding a strike that saw airports being shut and flights cancelled. Furthermore, the Irish company is notorious for avoiding any tax hikes; in February it decided to cut routes and jobs in Italy as a “result of a 40 per cent increase in passenger departure taxes”. The carrier said that from October it would drop 16 routes and 600 jobs after the Italian government this year raised departure taxes to €9 from €6.5 to help subsidise layoffs at former flagship carrier Alitalia.
Its call for zero charges at the regional Greek airports during the off-peak season is not something that would be easily palatable by the government, as it would jeopardise the current growth and, more importantly, would give Ryanair precedence over companies that have long invested in their presence in Greece, such as Aegean, which, according to its vice president Eftychios Vassilakis, managed to increase passenger numbers to almost 12 million from one million, without receiving any discount from the charges applied to the carriers using the Athens International Airport.
“We have not received a single euro discount from spatosimo,” he said, referring to the common name that the levy has (the airport is situated in the area of Spata). “Dozens of times we have said that the competitiveness of the charges and operation of airports and infrastructure is critical for development,” he said. “Especially the Athens airport, with excellent infrastructure and operation, is extremely expensive for passengers and airlines because contract concession is short.
“The recent signing of an agreement with Fraport for 50 years for regional airports showed that investments and public interests can keep up with the maintenance of low rates. The same should be done with the extension for AIA concession, which the government should begin to discuss with the Canadian shareholders. More time for concessions means lower rates for passengers and airlines and charges closer to Istanbul and Barcelona, our main competitors,” Mr Vassilakis concluded.
This turn of events has given the opposition parties in Greece an opportunity to lash out against the Tsipras government, accusing it of incompetence and indifference, stating that Ryanair’s decision to cut short its summer 2016 schedule will deeply affect Greek tourism this year, costing the country eight flights per day in the off-peak season. Professionals in the tourism industry in Greece have supported the government’s decision, accusing the budget air carrier’s policies and asking for the ministry to liaise with a number of other budget air carriers that operate across Europe.