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Greece sells off its holiday island airports

Plane lands at Corfu

Greece has finally leased out its main state-run regional airports to a private German-Greek consortium after months of negotiations.

Airports on the holiday islands of Mykonos, Kos, Santorini, Kefalonia, Samos, Corfu, Rhodes, Skiathos, Zante and Chania on Crete are included in the €1.23 billion deal.

Although welcomed by the Greek Tourism Confederation (SETE), the deal has its critics.

Regional governors on the Ionian islands launched an online referendum on privatising the island airports.

When the deal was first announced, Ionian Islands Prefect Theodoros Galiatsatos warned that the deal would have a severe impact the Ionian economy.

The Ionian islands are an important tourist gateway to Greece with the popular holiday hotspots of Corfu, Kefalonia, Lefkas and Zante among them.

They fear a big hike in landing fees that will put off low-cost airlines and charter companies with a knock-on effect for holiday package deals.

Under the 40-year agreement, ownership of the airports will remain with the Greek government, but the consortium will be free to run them as they think fit.

The offer consists of an upfront payment of €1.23 billion and an annual inflation-adjusted payment of €23 million.

The 14 Greek regional airports in the deal served some 22 million passengers in 2014 and are expected to handle 23 million passengers by the end of this year.

The German-Greek consortium is expected to spend more than €300 million on upgrading the airports by 2020 and create around 1,500 new jobs.

Selling off state-run assets will help swell Greece's depleted coffers as it struggles to pay off international loans.

Other projects in the privatisation pipeline include the Greek railways, postal services, telecommunications and a stake in Athens International Airport.

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