EU and Gulf countries make headway in aviation talks

LEIPZIG, GERMANY // EU and Arabian Gulf countries have made progress on aviation talks that will address the competition issue of Gulf carriers who are locked in a row with European and US airlines over alleged subsidies, the EU’s transport commissioner said yesterday.

European carriers have claimed that the Gulf airlines’ expansion in Europe is unfair because of the alleged subsidies they receive from their governments. Qatar Airways, Etihad Airways and Emirates have all denied such claims. European governments, including Germany and France, have joined the outcry, with European airlines fast losing market share to their Gulf competitors.

“We had a very successful meeting with the Gulf countries a couple of days ago in Doha and progress has been made,” Violeta Bulc told The National at a transport conference. “The talks were very friendly and much more encouraging than the previous one.”

Germany and France have asked the European Commission to take up bilateral negotiations with Gulf countries on any future aviation agreements rather than allowing individual European states to sign deals, Alexander Dobrindt, Germany’s minister of transport and digital infrastructure, said on Wednesday.

Air France-KLM and Germany’s Lufthansa in December wrote a letter to Ms Bulc regarding alleged government aid to Emirates, Etihad and Qatar Airways.

Ms Bulc, an entrepreneur and politician from Slovenia, said the European Union is working on a package of aviation measures with the Gulf.

“At the same time we hope to proceed with bilateral discussions with the major carriers in the Gulf and right now we are putting together an aviation strategy and aviation bilateral agreements will be part of that strategy,” said Ms Bulc.

“We are submitting [them] to the [European] commission in the fall and as soon as it gets approved then we will proceed with all the actions. We hope negotiations will start this year but it all depends on how successful we are going to be.”

Emirates highlighted in March its contribution of more than €10 billion (Dh40.01bn) to the European economy in a study by the London-based consultancy Frontier Economics, commissioned by the airline. The study estimated that the Dubai carrier, through its operations and aircraft purchases, supports 126,000 jobs across Europe.

Frontier estimated that Emirates’ operations, meanwhile, supported 85,100 jobs across the European Union in 2013 and 2014, equivalent to €6.8bn of the total EU GDP.

Frontier also said that the airline’s Airbus A380 deliveries for the same period supported 41,000 jobs, equivalent to €3.4bn of GDP.

According to the carrier’s chief executive, James Hogan, Etihad’s core operations in the EU contributed $1bn to the combined GDP of the 28 EU nations last year and supported more than 11,000 jobs there.

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