Ministry of Infrastructure of Ukraine will advocate expansion of the low-cost carriers market for Ukrainians, Volodymyr Omelyan
Volodymyr Omelyan, the Minister of Infrastructure of Ukraine, stated the above during the press conference in IA "Glavkom", which took place on July 14, 2017. Tetyana Romanovskaya, director of Lviv International Airport, also took part in the event.
Volodymyr Omelyan emphasized that the President of Ukraine and the Government completely support the policy of the Ministry of Infrastructure of Ukraine aimed at reduction of air travel fares for citizens.
"100 thousand of Ukrainian citizens have crossed the western border during the period of visa-free regime. Only 30% of them used aviation transport. All others have traveled by bus, by rail, by their own cars. It is expensive, time consuming and is not always convenient. That is why we believe that engagement of low-cost carriers is the best solution for Ukrainians traveling around the world and for foreign tourists, too. For some reason, we also forget about the second option. Low cost carriers are not interested in transporting all Ukrainians to Europe but letting people to travel in both directions. Therefore, this is a promotion of Ukraine and an attraction of tourists. However, when a tourist sees a flight ticket price of US300-500 dollars or even more, then he will not go. When the tourist sees the price of the ticket at 10-20-50 euros, he will fly to Ukraine at least for the weekend," Volodymyr Omelyan said.
The Minister of Infrastructure of Ukraine stressed that the management of Boryspil International Airport had no right to disclose details of negotiations with Ryanair: "It was extremely incorrect to comment on any details of the deal as it was confidential. It could be published later, after the signing of the contract, if necessary and upon an agreement by the airline. Unfortunately, this key principle of any negotiation was grossly violated, with the purpose of disrupting the negotiation process."
According to the Minister of Infrastructure, Lviv Airport had been set for successful completion of negotiations with the airline that helped the parties reach an agreement: “Lviv International Airport has the full right to affirm that negotiations can be conducted successfully. Instead, Boryspil International Airport blocked any negotiations with the Ryanair from the very beginning, not desiring competition and market development but keeping the monopoly position of one airline at the airport, where by a strange coincidence, the entire senior management are former employees of the UIA and Aerosvit airlines. I consider that by virtue of such action, the country is misled, while taxpayers have their money withdrawn. In fact, this leads to subsidizing air services by one company. This is unfair, and that is why, we will stand to the end."
According to Volodymyr Omelyan, Ryanair is ready to resume negotiations: "Yesterday I had a talk with the airline management. They are ready to resume negotiations, if only this dialogue will truly be a dialogue. I wish to reiterate that by this time, there were practically no negotiations with Boryspil airport. There were just public accusations from Boryspil management and maximum disruption of any negotiation process. I hope that with the support of the President of Ukraine and the Prime Minister of Ukraine, these negotiations will be conducted and completed on favorable conditions for Ukraine."
The Minister also noted that the policy of the Ministry is aimed at destruction of traditional monopolies, which do not bear any benefit for the country, but, on the contrary, slow down its development: "The state can have a qualitative product only through competition. We must clearly focus on these postulates and remember them. Neither the Ministry of Infrastructure, nor I will ever offer second-class or third class companies to Ukrainians. We offer exclusively world leaders. And you can easily see it."
The Minister of Infrastructure of Ukraine called the information that the arrival of Ryanair could cause financial losses to the airport a speculation. “The statements about possible losses of Boryspil airport are not confirmed, are based only on assumptions made by the airport managers, the former managers of UIA and Aerosvit airlines. This is a speculation. I am not talking now about how much UIA airline costs to the state budget. This is not a hundred and several hundreds of millions of hryvnias. I say that we must have competition, and therefore, - a quality product for Ukrainian citizens."
Separately, Volodymyr Omelyan emphasized that the Ministry did not provide privileged conditions for a particular airline: "To avoid any insinuations that we allegedly help one company and do not help the other one, we have set absolutely equal tariffs for all. The tariffs are transparent. They are published on the Ministry’s website and should be reflected in the public offer of Boryspil airport."
"You may not know, but some aviation charges at Boryspil airport have a profitability of 700% -800%. What do we want? To have expensive flights and one national company generating revenue, or that all have cheap flights and a normal, effective national company. We must clearly understand that we either create a market or do a favor for one party. I think we must create a market and develop in this market normally. Ryanair is not a comfortable party in negotiation process. But if there is a purpose, one can always reach a compromise that will be beneficial to all parties. If the purpose is not to allow Ryanair to enter Ukraine, then I am totally against this. There are many speculations on how much the airport will lose or earn. I am certain, and which also has been confirmed by calculations that were provided to Boryspil airport, that it is profitable for the airport”, the Minister emphasized.
Tetyana Romanovskaya, director of Lviv International Airport, noted that Lviv airport held successful negotiations with Ryanair airline: "We have been negotiating for a long time; the negotiation process has been extremely difficult. After long-held persuasions, approvals, and agreements, Ryanair have accepted our terms. We signed an agreement that is legal and beneficial. We have agreed on a competitive price, on granting maximum discounts conditioned on increase of transportation flow. The prices on which we agreed the deal with Ryanair are equal for all. Discounts offered to Ryanair are public and can be used by all airlines without exception."
"From the list of Ryanair requirements that Boryspil has announced, we have rejected a lot of points. In other words, it is absolutely possible. There is a framework agreement and there are annexes. It is suggested that the framework agreement applies when they start their flights in the first year, while the large list of preconditions as announced by Pavlo Ryabikin is not required. In fact, Ryanair does not require any land for a hotel construction or many other items. The framework agreement does not provide those points that Boryspil has announced. We did not sign them," Tatyana Romanovskaya added.