The International Air Carrier Association (IACA) renewed their calls to Hermes Airports Ltd., owners of Larnaca and Paphos airports, to urgently review their drastic increase in airport charges.
Hermes, which took over the operation of Larnaca and Paphos airports in May 2006, introduced a series of new charges for handling, security, fuel throughput and fire services which together represent a 300% hike in charges at both airports.
This radical increase in charges was introduced without consultation with the airline industry, without any justification and without following the standard ICAO procedures on airport charges.
Sylviane Lust, IACA Director General commented: “Airlines are being asked to pay up to 300% more for the same service levels as previous years. This is simply unacceptable and will act as a deterrent for airlines operating to Cyprus. Flying to both Larnaca and Paphos is now significantly more expensive which will have direct consequences for tourism to the island of Cyprus ”
Airport charges must reflect the quality and level of services provided at airports. While IACA airlines fully support initiatives to develop airport infrastructure, it is clear that airlines cannot be used to pre-finance such projects.
IACA is therefore calling upon Hermes to fundamentally review charges at Larnaca and Paphos airports. A transparent system with reasoned and justifiable levels of charges is in the best interests of airports, airlines and indeed tourism to Cyprus.
Airlines could drop Cyprus
As reported by the Financial Mirror in February, a number of airline companies, which have consistently provided Cyprus with the majority of well-spending tourists, are seriously considering whether to reduce their flights to Cyprus, or cut them altogether and divert their traffic to other neighbouring destinations.
Some of the increases include:
* Ground handling fees rising from CYP 400 to CYP 1200.
* Fire department fees for both incoming and outgoing flights charged at 25 cent per passenger at Larnaca airport and 35 cent per passenger at Paphos airport.
*Security charge per passenger starting at 67 cent per head from May climbing eventually to CYP 1 per head, charged for both incoming and outgoing flights.
* Excess Fuel charge of 0.005 cent per litre (most of the hit seen on CAIR since foreign airlines use Cyprus airports to top up fuel).
* Landing fees, based on separate legislation already voted through are set to rise by 18% from November 1, 2006.
For the passengers, they are facing an immediate hike in the airport tax from CYP 9 to CYP 10.5 per person.
The increases, which when combined with the fuel surcharge imposed by most airlines as well as the travel agent service charge mean the cost of air travel is set to rise sharply for the public.
Tourism threat
The island’s tourism industry may also feel an unwarranted squeeze if the same charges now planned for the scheduled airlines are also applied on the charter flights bringing the bulk of the 2.5 mln annual tourists to the island.
A charter flight operator contacted by the Financial Mirror said they have not been notified of the increased charges but acknowledged that he was aware “that charges would be hiked.”
The officer whose office handles many charter flights said either the government, through the CTO, will subsidise the charter airlines, or risk a flight to cheaper destinations, mostly Turkey.
During the Gulf war, the CTO was subsidising the cost of the insurance surcharge imposed on Cyprus flights to reduce the impact on charter flights, very sensitive to price changes, but following EU accession, such a subsidy would likely be blocked by Brussels as unfair advantage against the scheduled flight operators.
