How does the Aegean–Olympic merge affect Cyprus Tourism?

Aegean Airlines and Olympic Air are very close signing an agreement that will create the new Greek airline. The 2 companies will very soon announce their merge and the new airline will be called Olympic. The new company will have a structure where the 2 strong men of the two companies will have equal shares, Vasilakis  from Aegean and Vgenopoulos from  Olympic Air (Marfin Group) and the rest of the shares will be in the Greek stock market. The new entity will be owned by Aegean Air by 75% and 25% by Marfin . (News published on Inbusiness news online in Greek)

Now the question drawn from this piece of news is.  When are they going to buy Cyprus Airways,  Eurocypria of both? The bad financial situation of the two Cypriot Airlines should worry the Cypriot Tax payer. The airlines that lately had a media fight about who should close down, are completely sustained by state investment. The state of Cyprus owns 100% of the regular airline (Cyprus Airways) and 100% of the charter airline, Eurocypria. The minister of finance of Cyprus has played his last card for Eurocypria last week at the parliament where he obtained 35 million Euros to inject them in the empty cash drawers of Eurocypria.
Most economists of Cyprus believe that the 2 airlines are not sustainable due to their very high operational costs produced basically by the “heritage” of civil servant employees and the lack of modernization of internal procedures in order to have more flexibility and productivity.

Now with the airports of Cyprus being managed by the private sector the 2 airlines do not have the favours they user to have before (especially before 2004) something that finds them “exposed” to the open global market. If the new Greek airline giant wants to keep the piece of the pie in the Cypriot routes then the option of buying the 2 companies is not a bad one.

We will be waiting to see what the next move is. Vgenopoulos has the expertise in buying Cypriot companies and I am sure he knows the potential of Cyprus as a hub in the eastern Mediterranean.

From this blog I predict that next year the same day we will be talking  about one global Greek and Cypriot air carrier and is then when we will be able to fly to Cyprus with better connections and definitely better prices.

Larnaca Airport, the only jewel

The unfortunate black-out of the runways in Larnaca Airport has created in my opinion too much noise. Hermes Airports has proven to be an efficient and very responsible company delivering without one day of delay 2 brand new airports for Cyprus according to the planed and signed schedule.

Hermes airports is the only company who made Cypriots proud the last years. The international airports of Paphos (PFO) and Larnaca (LCA) are definitely the only jewel on the Cypriot Crown. The Republic of Cyprus has never been able to deliver any public work without creating a wave of corruption scandals (I remind you XEKTE who built the highway Nicosia – Limassol and many other scandals that have also been pointed in various reports throughout the years) , the 2 airports have been the only public works that have actually finished on time and worked on time sine the independence of Cyprus.

The operation of the two airports is not an easy job, accidents and unfortunate happenings will happen until the “intestine” of the airports is smooth.  I was present at a major black-out of the Boston airport due to extreme weather conditions, I was also “captured” by extreme weather in London Heathrow that caused serious problems in the operation of the Airport but I did not experiment the criticism of the politicians.
Cypriot politicians should not make any comment, on the contrary they should think that they live in a “glass house” and a minor stone could demolish it. Politicians in Cyprus have managed in 30 years to convince the Cypriot citizens, that when it comes to public works are incapable to bring them to a good port.

If I were a political figure in Cyprus I would go out and ask for forgiveness for not doing my job for so many years.

Measures to boost Tourism in Cyprus cause collateral damage

Lately we hear on the news that the measures the Cyprus government adopted to boost tourism will continue for the year 2010.

The Ministry of Commerce, Industry and Tourism through the Cyprus Tourism Organization spends millions of Euros on “bonus plans” to the Tour Operators from almost all over the world (at least all the markets they consider primary) who manage to land tourist in Larnaca(LCA) and Paphos(PFO) Airports. This policy is widely accepted in the Tourism Sector since the bonus is given to the Tour Operators either according to the number of passengers landed or as advertisement fees for the advertising campaigns the Tour Operators make in the country of origin.

The list of the Tour Operators is huge and is of public domain. What is not public is the amount of bonus each Tour Operator received and the agreement signed between the 2 parts. Nevertheless, studying the list we will see companies from the UK, USA, Germany, France, Italy, East Europe, Arab Countries and many others.
Lately we had some rumors that an Italian Tour Operator that had a bonus agreement with the Republic of Cyprus and also had contracts with hotels in “North Cyprus”. This provoked the reaction of the Minister and the Tourism Professionals in the Republic and the Minister promised to investigate the mater in depth.
The fact that tourists land to Larnaca and then taxis, private cars or other means of transport drive them to the hotels in “North Cyprus” is neither a secret nor a lie. It can be for sure verified very easily just by visiting the arrivals hall of Larnaca airport and see taxi drivers holding signs with names of hotels located in the “other Cyprus”. Hotels like “Acapulco Hotel “ Kyrenia”, “Manolia Hotel in Lapythos”, “Dome Hotel - Kyrenia” and many others including many casinos.

The big tour operators that land to Larnaca and Paphos such as Thomas Cook and Thomson “ Tui do not only offer Tourist Packages with flight, hotel and transfers but they also offer flight-only options to their customers. They do than not only in Cyprus but all over the world and there is nothing wrong with that, on the contrary they cater for the FIT market (Free Independent Travelers) who definitely have a different spending power and interests. Now, in Cyprus since the road blocks to the “North” are still open there is no way to control who and why visits the “North”. What happens the last years is that tourists who the Greek Cypriots taxpayers have paid them to come to Cyprus, land in Laranca and then spend their holidays in hotels that were built on Greek Cypriot occupied land. The internet and especially travel forums and the Social Media sphere are full with comments like "We had a wonderful time in North Cyprus, we flew to Larnaca with Thomsonfly..."

This shows us that our Government in an indirect but “effective” manner is taking the “North out of the economic isolation”. We, the Greek Cypriot taxpayers even now in times of Crisis and when tourist overnights are down by at least 20%, still support the model of prizing operators and airlines. It is not possible to control who is crossing the Green Line since the road blocks remain open. We cannot prohibit to EU citizens to go on holidays on European land but we can stop paying for that.

At last we have to stop pumping tax money into the bank accounts of the big guys and look into a serious change of tourism policy, we should finally make this policy very personal. We need to look at tourism as a face to face relationship with each and every visitor to Cyprus. I would suggest new bonus plans that have direct effect to all the visitors, we need to encourage independent travelers to come to our country and stay here with us. Bonus plans that promote our hospitality and do not give in to the “warnings" of the “feudal lords of tourism”. For more information I remind you the speech of a director of  Thomson - Tui during the Hoteliers Association Conference in Nicosia the 12th of February 2009 when in front of the minister of Public Works and the Minister of Tourism said, “help us to help you” when in a direct manner asked us for more money. He and his team were pushing for a 20% discount on the contracted rates for 2009 something that they achieved. During lunch break he also achieved a 5% retroactive discount on the pending invoices in order to “decrease corporate losses”. Nevertheless the biggest achievement for companies like Tui was to assure that the Cypriot taxpayers keep paying them to bring visitors to the legal airports of the country and then let them free to visit “the uncovered north where time seems stopped, the authentic Cyprus, North Cyprus”

Dear Mr. Paschalides in tourism we need measures without collateral damages, we need measures that assure future to the only industry left which you can be minister of, we need to control those measures and make sure they really bring a benefit. We want those measures to be under the control of those who pay them.

Paphos International Airport - (PFO) – A great Experience

In the eighties Pafos was written on the international airport map with its PFO airport. Then the society in Cyprus was divided. Was Paphos was big enough to host an international airport? The area was basically abandoned by the Cypriot State since the connection between Limassol (Lemesos) and Pafos was made by a narrow curvy and dangerous road and there was indication that the high way was soon to be built. Today after 20 years, Pafos has the highway and Pafos – Limassol is just 30 minutes drive. In November 2008 the new Pafos International Airport was inaugurated. Today I had the opportunity to fly to Thessaloniki (Makedonia Airport) from Pafos.

I invite all of you who want to travel from Cyprus and to Cyprus to choose Paphos Airport (PFO). The building is full of natural light, the decoration is smooth, the walls are decorated by works of art from local artists, the character of the place is modern and is has nothing to envy any modern European Airport, its size is just ideal for the area, human and friendly atmosphere that inspire you security and comfort.

Finally Pafos left behind its 20 years of bad airport history, finally we have an airport we, the citizens of the area and all the Cypriots, deserve. Thank you Hermes Airports for the effort and please keep the quality high, now is time to work to get more flights and boost tourism and business travellers to Pafos.