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Tue 16 Oct 2012 12:57 PM

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UAE min slams gov't meddling in airline sector

Sheikh Nahyan says some national governments denying Gulf airlines "full access to their market"

UAE min slams gov't meddling in airline sector
HH Sheikh Nahyan bin Mubarak Al Nahyan, UAE Minister of Higher Education and Scientific Research.

A “healthy, prosperous” airline industry is one of the biggest forces for achieving world peace, but faces obstacles including interference by governments in the sector, the UAE’s Minister of Higher Education and Scientific Research said at an aviation conference in Abu Dhabi on Tuesday.

“I declare that a healthy, prosperous world passenger airline industry is one of most potent forces in our quest for world peace,” HH Sheikh Nahyan bin Mubarak Al Nahyan, UAE Minister of Higher Education
and Scientific Research, said in a speech at the IATA World Passenger Symposium in Abu Dhabi.

“Your airlines have become even more important in bringing people, language, ideas and values together,” he told representatives from airlines around world.

However, Sheikh Nahyan hit out at interference by governments in bilateral aviation agreements as a potential threat to this.

“Intervention by governments is still all too common. Generally they tend to impede the industry's ability to manage demand and supply… For example, false beliefs about government subsidies to serve airlines in our region have caused some governments to deny those airlines full access to their market,” he added.

Dubai-based Emirates Airline has faced a long-running battle to secure more landing slots at airports including Stuttgart and Frankfurt. German carrier Lufthansa claims that Emirates receives government subsidies and therefore skews competition in the German market.

UAE airlines have also faced similar issues in Canada, where in 2010 both Emirates and Abu Dhabi's Etihad Airways were refused additional landing slots at Canadian airports by the North American country's transport agency. The incident quickly escalated into a diplomatic spat between the two countries.

“Above all, such actions harm the interests of potential passengers who desire to travel to those countries. Such government interventions lack justification,” Sheikh Nahyan added, without mentioning any specific examples.

While Sheikh Nahyan said intervention in the area of safety and security was acceptable, he highlighted the EU Emissions Trading Scheme as an example of government interference which may have negative consequences. The scheme will force carriers to pay more based on the volume of carbon their aircraft emit while flying into and out of the European Union.

“Some states that have threatened to introduce national taxes on the pretext of environmental protection may be seen as unwarranted and may lead to retaliatory responses… We in the UAE that the environmental concerns should be fair and balanced,” he said.

Sheikh Nahyan is not the only public figure in the Gulf to have openly criticised the EU Emissions Trading Scheme. Earlier this year, Qatar Airways CEO Akbar Al Baker claimed the EU was using the scheme as a way “covering up” inefficiencies in how it manages its finances.

Al Baker labelled the scheme an indirect tax, stating that it would heavily penalise Gulf carriers that are rapidly expanding their fleets.

Authorities in countries including the US, Australia, Singapore, Canada, Brazil and Russia have also voiced their concerns over the scheme.

* The quotes in this article were initially incorrectly attributed to HH Sheikh Abdullah bin Zayed, UAE Minister of Foreign Affairs, who was originally scheduled to make the keynote speech at the IATA Passenger Symposium 2012 in Abu Dhabi.

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Joel Hughes 7 years ago

was it not just a few years back the UAE stopped Canadians being able to visit the UAE due to landing rights of UAE carriers in Canada. Sometimes you have to wonder.....

Grant Holt 7 years ago

I'm all for the free market, and I personally choose to fly Emirates over other national providers because I like their service and comparable prices.

However, lets hope the UAE removes all its business barriers for telecoms, utilities etc and also the antiquated sponsor system, so that the country can really progress and become a country of innovation rather than duplication.

www.aljoufilaw.com 7 years ago

Some countries regulates the airline sector to protect their own airline industry, especially for its flag carriers. This can be a subject of a trade agreement to allow mutual benefits.

Cheated investor 7 years ago

I agree a healthy economy is about giving their rights to people Sir. When will RERA and government related developers stop mingling with investors properties, money and rights and allow the laws to be implemented fully? This would bring peace of mind and prosperity into thousands of investors families and also UAE. Lead by example and people will praise you

RBH 7 years ago

There are laws against monopoly. Yes you can expand your business, but airlines are not a monopolist's market.

H. Dad 7 years ago

Just because is relatively new in the filed , it does not mean that the EU and other countries should try and play double games behind their backs !

Having invested billions , they have full rights to be dealt with fairly and equally.

Watch out - EU , u could be on losing grounds in the long run .....

Jake 7 years ago

World peace? Seriously? Again, the only sector where the UAE allows any sort of free trade is the airline sector. Whether the telecom sector or sole distributer agencies, UAE markets aren't free.

Ali 7 years ago

You are comparing apples and oranges. Airlines and telecom are completely different areas. Free markets for airlines dont harm anyone, on the other hand they benefit everyone involved.
Telecom is a much more different area, and allowing uncontrolled access will only lead to chaos.
People should read up a bit before making uninformed comparisons.

steve 7 years ago

So Ali you are saying that if a country (lets say Germany) permits a UAE airline to land and takeoff from any city as often as they want it won't hurt the German Airline businesses? I wonder if Australia and Qantas agree with your statement. Keep in mind the control of flag carriers is very important to a given country. It does in some case become a national security issue.

Grant Holt 7 years ago

Your quiet right Ali, it will never work for telecoms! What are Etisalat thinking about buying into 19 forgien markets? Surely you need to advise them it will never work, it will only lead to chaos.

But how are they allowed to buy into foriegn markets, when others are not allowed into this market to give the consumer fair competition and a better service? Is that a fair free market economy?