Macedonia to keep controversial airline subsidies

The Macedonian Minister for Transport and Communication, Vlado Misajlovski, has confirmed that the government will continue to subsidise low cost carriers, a move which will not sit well with authorities in Kosovo who say the policy has distorted competition in the region. Speaking in an interview, Mr Misajlovski said, "The benefits of the subsidies are visible and will continue. We have generated 34 direct routes, 24 of which are within Europe with very reasonable fares. We are currently negotiating with several other airlines which are interested in entering the Macedonian market, which will open up new destinations. As a result of this policy, passenger numbers at Skopje Airport have grown by 20% each month". The Macedonian government launched a three-year subsidy scheme in 2012. It proved successful with Wizz Air opening a base at Skopje Airport, which has in turn led to significant passenger and traffic growth. A fresh round of subsidies was offered last year, which led to Wizz Air basing a third aircraft in the Macedonian capital, launching a handful of new routes and introducing services from Ohrid as well.

The Macedonian Ministry for Transport and Communication says its incentives policy has been carefully analysed and is in accordance with EU rules and regulations. It adds that in 2012 the Kosovan Ministry for Infrastructure was sent additional information on the subsidy program which, it says, respects all international legal procedures. However, the Kosovo Civil Aviation Authority has filed a complaint with the European Commission, while Pristina Airport says it is unacceptable for the state to provide these subsidies, and argues they should come in form of incentives from the airport operator itself. Mr Misajlovski notes that the policy has proven extremely successful. "In 2015 we had only ten to fifteen destinations. Now we have direct flights to London, Venice, Basel, Malmo, Eindhoven, Dortmund, Milan, Munich, Memmingen, Stockholm, Gothenburg, Brussels, Frankfurt, Cologne, Paris, Barcelona, Oslo, Nuremberg, Hamburg, Friedrichshafen, Berlin, Copenhagen, Bratislava, Zagreb, Geneva, Prague, Dubai, Belgrade, Ljubljana, Rome, Istanbul, Vienna and Zurich", the Minister said, adding that Wizz Air recently launched a new service to Hannover, while Qatar Airways will soon introduce flights from Doha.

Speaking to EX-YU Aviation News last week, a European Commission spokesperson said, "The Commission is aware of concerns raised about the financial incentives' scheme granted by the Government of Macedonia since 2012 to both domestic and foreign airlines to fly from the "Alexander the Great" Airport. It could possibly distort competition between airports in the area and indirectly between the airlines concerned. DG MOVE [Directorate-General for Mobility and Transport] is in contact with the competent Macedonian authorities to get all necessary information to examine this matter. This is taking place in the framework of the European Common Aviation Area Agreement, which was signed in 2006. While this Agreement is not in force yet, it is applied administratively". In its most recent annual progress report on Macedonia in the area of air transport, the European Commission said that "concerns about possible state aid in the aviation sector need to be addressed".