Cyprus & World News

Cyprus to privatise air traffic control by 2015

13 May, 2014

A new company providing air traffic control services will be set up by 2015, breaking away from the Civil Aviation Department and the Ministry of Communications and Works, Minister Marios Demetriades said on Wednesday.

This is part of a new process to privatise or outsource to the private sector many of the public utilities and state-controlled monopolies, as part of a debt reduction and bailout programme imposed by the Troika of international lenders to Cyprus.
The government plans to privatise at least eight services and organisations within the next four years in order to cut down on public spending and to improve efficiencies, raised a further 1.8 bln euros to help reduce a runaway public debt that, combined with an over-inflated banking sector, brought the island’s economy to its knees last year.
One of the first services to be privatised is the management of the Limassol and Larnaca ports, with the Cyprus Ports Authority remaining the owner and regulator, but not operator. On Tuesday, the government also said it was planning to sell the National Lottery, that in 2013 alone earned about 20 mln euros in profits.
Other privatisations slated over the next four years include the state-owned telco Cyta, the power company EAC, stakes in public companies and other assets.
Air traffic control is a good revenue earner, with annual profits for the state estimated at about 60 mln euros, primarily because of the fly-overs within the Nicosia Flight Information Region (FIR) due to the security provided in an otherwise high-risk and conflict area.
The Minister stated that he received a preliminary study on the creation of the new company, and expects a similar study to be handed over by summer, on the restructuring of the Civil Aviation Department.
Demetriades was speaking after a meeting with Eurocontrol Director Network Manager Joe Sultana, in Nicosia, who is working on the establishment of the new company and a proposition concerning the Department’s restructuring.
According to the Minister, changes will take effect after having secured the agreement of all parties involved, including militant trade unions, in order to reach the desired goal through collective work.
With the establishment of the new company, the Civil Aviation Department will handle issues concerning only licensing, certification, training and supervision.
It is expected that the operation of the new company would solve certain problems, such as the delays in Cyprus airspace, a problem Turkey is trying to use to its advantage and attribute a role to the illegal control centre in Turkish-occupied Tymbou.