The Guvnor
23rd Nov 2001, 13:32
From today's Telegraph:
EU firm line on state aid - even if top airlines fail
By Alistair Osborne (Filed: 23/11/2001)
THE European Commission warned yesterday that it would be prepared to see many of Europe's flag-carriers go bust rather than relax its rules on state aid.
Loyola de Palacio, the EC's vice-president for transport and energy, said she would adopt the same policy with Ireland's Aer Lingus, Greece's Olympic Airways, Italy's Alitalia and Spain's Iberia as she did with Sabena of Belgium.
"I am not ready to accept any changes to the rules on state aid because the need for restructuring the sector came before September 11," she said.
"You ask are we going to be able to resist the calls for help. Once Sabena has been allowed to go over, you can't be different with the others. Sabena happened during the Belgian presidency [of the EU], so you can imagine this was not an easy decision."
She added that "having 14 national flag carriers is not sustainable".
"We must overcome thinking about national flag carriers. We must think about European carriers," she said.
She said she had some concerns about the US bail-out of its aviation sector, with the government advancing $5 billion (£3.5 billion) cash and $10 billion of loans.
The policy in Europe would be to restrict support to such things as allowing governments to be insurers of last resort against terrorist attacks.
The British Government said yesterday that it had extended such an agreement with UK airlines until January 23.
The commissioner said the bilateral agreements between individual member states and other countries, such as America, distorted Europe's aviation market and caused the mergers it needed "to be delayed".
The European court in Luxembourg is due to rule in January on whether the current system of bilateral "open skies" deals should be replaced by EU-wide agreements.
She could not say, however, what the EC could do about existing bilaterals or those currently being negotiated, such as between the UK and the US, which may allow an anti-trust alliance between British Airways and American Airlines.
Should that deal be approved, she warned, it would still require the approval of EC competition commissioner Mario Monti.
Ms de Palacio reiterated her view that the oil price could be too low, saying "$10 a barrel in my view is bad news". She said such a price gave "all our policy on renewable energy a big hit".
She said industry was best served by "stable prices" rather than volatility and suggested an optimum price of "around $20". Last night, Brent crude for January closed up $1.25 in London at $19.92.
[ 23 November 2001: Message edited by: The Guvnor ]
EU firm line on state aid - even if top airlines fail
By Alistair Osborne (Filed: 23/11/2001)
THE European Commission warned yesterday that it would be prepared to see many of Europe's flag-carriers go bust rather than relax its rules on state aid.
Loyola de Palacio, the EC's vice-president for transport and energy, said she would adopt the same policy with Ireland's Aer Lingus, Greece's Olympic Airways, Italy's Alitalia and Spain's Iberia as she did with Sabena of Belgium.
"I am not ready to accept any changes to the rules on state aid because the need for restructuring the sector came before September 11," she said.
"You ask are we going to be able to resist the calls for help. Once Sabena has been allowed to go over, you can't be different with the others. Sabena happened during the Belgian presidency [of the EU], so you can imagine this was not an easy decision."
She added that "having 14 national flag carriers is not sustainable".
"We must overcome thinking about national flag carriers. We must think about European carriers," she said.
She said she had some concerns about the US bail-out of its aviation sector, with the government advancing $5 billion (£3.5 billion) cash and $10 billion of loans.
The policy in Europe would be to restrict support to such things as allowing governments to be insurers of last resort against terrorist attacks.
The British Government said yesterday that it had extended such an agreement with UK airlines until January 23.
The commissioner said the bilateral agreements between individual member states and other countries, such as America, distorted Europe's aviation market and caused the mergers it needed "to be delayed".
The European court in Luxembourg is due to rule in January on whether the current system of bilateral "open skies" deals should be replaced by EU-wide agreements.
She could not say, however, what the EC could do about existing bilaterals or those currently being negotiated, such as between the UK and the US, which may allow an anti-trust alliance between British Airways and American Airlines.
Should that deal be approved, she warned, it would still require the approval of EC competition commissioner Mario Monti.
Ms de Palacio reiterated her view that the oil price could be too low, saying "$10 a barrel in my view is bad news". She said such a price gave "all our policy on renewable energy a big hit".
She said industry was best served by "stable prices" rather than volatility and suggested an optimum price of "around $20". Last night, Brent crude for January closed up $1.25 in London at $19.92.
[ 23 November 2001: Message edited by: The Guvnor ]