Greek island airports sold off
Andy Cornish: December 2014
More than a dozen Greek Island airports are set to be sold off in a move aimed at filling the Greek government's cash-strapped coffers.
Airports on some of the most popular holiday islands are about to be privatised in a deal that will give private investors a 40-year lease to run the airports.
No doubt to the annoyance of the many Greeks, who blame Germany for its six years of recession and tough austerity measures, the tender for the airports has been won by Frankfurt-based airport operator Fraport with help from the Greek industrial group Copelouzos.
The consortium will pay €1.2bn for three mainland and 11 Greek island airports that together handle around 19 million passengers per year.
They include airports on Crete, Corfu, Zante, Kefalonia, Rhodes, Kos, Skiathos, Mykonos, Santorini, Samos and Lesvos.
There are added options on smaller islands and on several mainland airports including Thessaloniki, which serves the Halkidiki holiday area, and Preveza, the main airport for holidaymakers travelling to Lefkas in the Ionian.
The sale was handled by the Hellenic Republic Asset Development Fund (HRADF), the organisation that is responsible for the sell-off of not only Greece's regional airports but many Greek ferry ports as well.
Until now, all Greek regional airports have been state-owned and supervised by the Hellenic Civil Aviation Authority (YPA).
Better facilities promised at Greek island airports
Supporters of the privatisation plan forecast that all the airports can increase their income, create more jobs and support the local economies by possible better usage of their infrastructure as well as other commercial activities.
According to HRADF, the sale will result in upgrading any airports to provide better and faster tourist facilities and so enhance Greece's profile as a world-class tourist destination.
Critics argue it will lead to higher fares to tourist passengers as privatised airports hike landing fees and cargo handling charges, costs that will sooner or later be passed on to customers.
In Chania, protest demonstration have been held by local people angry at the sell-off of such a profitable airport, a move they claim will only benefit the interests of corporate companies and not the local community.
Some of the airports, such as those at Chania on Crete, currently have a with heavy military presence and usage but only the civil areas will be privatised.
Under the terms of the deals, the German/Greek consortium will have 20 months to upgrade and renovate existing facilities while new works and extensions must be completed within four years.
Holiday visitors expected to top 20 million
With tourist arrivals in 2014 tourist arrivals expected to top last year's record of 18 million by a significant and with tourists are forecast to spend €13.5bn, many Greeks consider this a bad time to be selling off valuable state assets
But the Greek government has been under pressure to sell, having fallen badly behind on a privatisation schedule that promised €22bn of sales by 2013, but has only delivered €5bn so far towards paying off the €240bn bailout by the IMF.
At least holiday passengers should benefit from better facilities at many of the island airports. Fraport has promised to invest €300m in improvements to the airports in the next four years.
Fraport is one of the largest airport management companies in Germany with 11 airports ion its books including one of the largest in Europe at Frankfurt.
Also pouring cash into the tourist market recently has been the Greek-owned Aegean Airlines, which recently announced a €300m investment in seven new A320s and the addition of 14 new international routes into Greece.