Millennium Post

EU forces Cyprus to shut national airline

Cyprus’ national airline lost its operating license and stopped all flights after the European Union ruled that it had ‘illegally’ received tens of millions of euros in state aid, officials has said. Finance Minister Harris Georgiades and Communications Minister Marios Demetriades said that an administrator will now be tasked with winding down Cyprus Airways. The country’s air transport licensing authority said it revoked the airline’s license because it could not ensure flight safety as a result of its financial troubles.

The EU ruled that Cyprus Airways, which is 94 per cent government-owned, must pay back over $76.78 million out of a $121.67 million state aid package it received in 2012-13 that gave it an unfair advantage over competitors. The ministers said the government will cover the estimated cost of 6-7 million euros of Cyprus Airways ticket holders who either wish to be reimbursed or make alternative travel arrangements.

Demetriades said some 70 airlines fly to Cyprus, which received a multibillion euro international rescue nearly two years ago, and that the demise of the national carrier whose market share dwindled to a mere 10 per cent won’t diminish the east Mediterranean island’s air links abroad.

He said plans are under way to set up a new company with private backing that will bear the Cyprus Airways name and logo. Airline staff milled outside the company’s Nicosia offices awaiting word of what will happen to them as Georgiades said they will receive salaries and pension benefits that they’re entitled to.
PTI

PTI

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