Open sky program may give Russian airline companies a dare

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Published time: December 07, 2011 13:56
Edited time: December 07, 2011 17:56

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Infrastructure, Investment, Russia and the global economy

After a series of deadly plane crashes in Russia, which have been blamed on outdated aircraft and poor servicing authorities are considering allowing foreign airlines to operate domestic services within the country.

According to the Vedomosti newspaper, the Ministry of Transportation is preparing to allow Czech Airlines and Air Baltic to provide transport for the teams belonging to the national ice hockey league. A plane carrying the Yaroslavl ice hockey team crashed on take off earlier in the year killing almost everyone on board. This prompted calls for greater air safety from President Dimitry Medvedev.

The plans by the Transport Ministry could be the first step towards an Open Skies policy. A pilot scheme in Vladivostok during November, allowed foreign airlines unlimited access to airspace and airport facilities.

Investcafe analyst Kirill Markin, thinks if the program goes ahead it will have a positive impact on civil aviation in Russia. “The precedent will make Russian air carriers improve their service, because local companies can not successfully compete with foreign counterparts yet”.

Open skies won't happen over night says Dmitriy Baranov chief expert in Finam Managment company, but it will have some good effects, “Ticket prices will decrease, the market will be more mobile due to foreign companies’ presence, but it will take a while for companies to register, sign papers and find their way around the realities of doing business in Russia”.

Alexey Zakharov, Finamaero analyst agrees the Russian domestic flying experience is far behind Western companies, and a wide choice of air carriers could contribute to local air industry, but he doubts the possibility the program will be implemented. He thinks it's nonsense. “The Ministry’s project is merely a populist act, an attempt to smooth over the public reaction to the recent KHL team air crash”.

Comments (2)

gunshipdemocracy 08.12.2011 14:29

yep, but diasproral speculators never allow their paid knecht-analysts to talk about real cause of problem. Letting airlines get needed capital first then compete is different from allowing small airlines compete with rich giants in "fair competition". Same process was done to east European countries - no local banks neither industry, only assembly plants using cheap workforce. Govts are western puppets generously paid for enslaving their countries.

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New World Order 08.12.2011 06:14

This is clearly misguided neo-liberal which will get much worse once Medvedev becomes the PM. What is required is purchasing new plans for the domestic front rather than opening foreign competition before the Russian domestic carriers are ready for competition. Here what is proposed is not open sky but foreign take over and killing of the domestic industry—no wonder the communists think they want their country back.

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