Why is Ryanair annoyed with Greece?

- Leadership - Sep 22, 2016

Europe’s biggest budget airline Ryanair has been threatening to reduce flights to Greece and its surrounding islands starting from next year.

The carrier, owned by Irishman Michael O’Leary, has been frustrated by recent attempts to negotiate more favourable terms with the Greek government regarding taxation in the off-peak season.

If taxes were to be reduced, Ryanair would have promised to deliver an extra five million visitors to Greece – tourism being one of the most important industries as the economy looks to rebuild.

Speaking to Euronews, Ryanair’s Chief Commercial Officer David O’Brien said that departure taxes are abnormally high, so much so that the company will not fly to Kos in 2017. It is also going to reduce flights to other nearby Greek islands.

He said: “The main problem really is airport prices and airport taxes in Greece. We have written several times, more than 20 times, to various Greek ministers, not just this government, to the previous government, and they are perfectly entitled to disagree with us, we did not get any answer I might add. Therefore we decided ‘let’s not waste our time’.”

Ryanair faced a similar problem in Italy where the government planned to increase airport taxes. The plan was dropped following a petition and now the airline plans to base more operations there next year, bringing more tourists and more than 2,000 new jobs to the country. It will base 10 more aircraft in the country, with 44 new routes being adopted.

O'Leary said in August: "We are extremely grateful to Prime Minister Renzi and Transport Minister Delrio for taking these initiatives to grow Italian tourism.

"All of this growth would have been lost to other EU countries if the Municipal Tax increase had not been reversed, and the airport guidelines had not been redrafted to comply with EU rules."

Read the September 2016 issue of Business Review Europe magazine. 

Follow @BizReviewEurope

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