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State monopoly not the answer in competitive sectors, FinMin says on flight prices

Finance Minister Harris Georgiades has said that state monopolies are not the answer when it comes to competitive sectors.

Replying to journalists’ questions at the Ministry on Friday, Georgiades dismissed opposition parties’ criticism over the recent rise in airline tickets and allusions that this is related to the state air carrier Cyprus Airways shutting down in January 2015.

He spoke of previous bad management which led to the carrier’s defaulting and the European Commission’s unavoidable conclusion that state aid granted in support of the ailing airline in previous years had been illegal.

“Without a doubt I reiterate now that state monopolies is not the answer in such competitive sectors,” the Finance Minister stressed.

The answer is for market forces to be able to work, he added and that is what institutions such as the Competition Protection Committee are there for.

A Finance Ministry press release shows that after Cyprus Airways shut down the Air Transport Passengers Index presented a significant drop and that from 2016 onward when low cost airlines made an appearance in Cyprus the index remains stable.

According to the graphics contained in the press release, there are significant changes in airline tickets for different destinations.

In particular, the cost to fly to Athens and to Thessaloniki, has presented a significant increase in June 2019.

On the other hand, airline tickets to London and Manchester follow a downward trend.

In comparison to the relevant EU index for the period December 2016 to May 2019 the timeline seems to follow the same tendency but a lower price level.

(Cyprus News Agency)

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