A blast from the past

Despite having to compete, perhaps unfairly, with low-cost carriers, Air Malta has so far proven that it can fend off this challenge

A week after MaltaToday revealed that a financial turnaround had taken place inside Air Malta, perhaps everyone seems to have forgotten the quandary we faced as a country when we forked out subsidies to attract low-cost airlines to Malta.

The minister at the time, Francis Zammit Dimech, had a valid argument, truth be told, opining that subsidising landing fees for low-cost airlines would push Air Malta out of the market and into more serious financial problems. Considering that Air Malta had a bloated work force and a disingenuous way of remunerating its different grades, Zammit Dimech had good reason to be worried.

But eventually the Gonzi administration gave in and low-cost airlines were essentially subsidised, their landing fees made cheap under route support schemes blessed by the European Commission for airlines which fly underserved routes and to small airports.

Brussels is OK when cutting landing fees for Ryanair, but then it is against state aid to national airlines like Air Malta.

Well… low-cost airlines came, brought with them more tourists, and allowed the Maltese to visit new European locations, and of course, ate into Air Malta’s market share. And so here we are, millions of euros later poured into route development schemes for non-national airlines, with the hospitality industry making its veritable profits and building its additional storeys and high-rise towers… and the big question is: do we get to revisit the subsidy to low-cost giants?

It is after all our money. Ask yourselves: have LCCs created more benefits to the community than negatives in terms of their multiplier effect in tourism? Do we depend on LCCs?

To me there is no doubt that LCCs only operate because of the unfair playing field that allows this section of the market cheaper landing fees when airlines like Air Malta do not have this prerogative.

Having said that, whether you like Konrad Mizzi or not, on his watch Air Malta has so far proven it can fend off this challenge. A combination of his own political determination and perhaps his academic obsession to micro-management has led to this achievement. And finally, we have seen how growth, not just downsizing, is essential for such businesses. They required investment and vision, not just asset stripping.

Time might yet prove Mizzi right and critics who say he is overstretching Air Malta, wrong. The aviation industry is highly sensitive to changes and unforeseen scenarios, but Air Malta seems to have a big smile on its face. There are probably few places in the world which cherish their national airline as much as we Maltese do. It is our own economic icon, and we take pleasure in being associated with it. This is still a success story. This is our national airline, and it should stay in a serene financial state.

 

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Interviewing former Prime Minister and Labour MEP Alfred Sant this week was simply refreshing; not that I agree with him on all his political perspectives but I would say that his elegant, direct, and playfully naïve way of presenting his arguments can be entertaining.

He reiterated his age-old argument that his biggest disappointment was not convincing the Maltese to agree to his ‘partnership’ approach to Malta’s EU relationship in lieu of membership.

Those candid statements proved beyond doubt that Sant has not changed. But many people have misconstrued Alfred Sant. He was, after all, not a vindictive politician, tolerated political adversaries in running some of his agencies, and had no blemishes or allegations of corruption against him. At the end of the day, he was brought down not by the PN – which enjoyed his tenure at Labour’s helm right up until 2008 – but the fiery patriarch Dom Mintoff, who damaged Sant when he finally lost his government in 1998.

In my interview last week I asked him why Simon Busuttil, the former PN leader, failed to find favour with the electorate and floating voters with his high moral standards crusade in the 2017 election. Sant, rather frankly, admitted that corruption claims alone would not win anyone an election. “He needed to have a vision apart from talking about corruption; I talked about corruption but I had a message too,” he quipped and went on to explain how Simon Busuttil’s idea for a nationwide metro was a good idea, but which had not been followed through during the campaign. “Instead Busuttil teamed up with the Partit Demokratiku and ended up losing two seats to them,” he said.

In Brussels, Sant stands out as an MEP who says it as it is – surely in a league of his own, an old school Labourite who remains opposed to EU federalism but has a keen eye for the economic forces of Europe’s centre which suck more and more out of weaker border countries.

It means he stands in contrast to the up and coming MEP Miriam Dalli, one of a breed of slick social-democrats who, thankfully, has a strong agenda on environmental and women’s issues. Yet Sant is still strong with the Labour grassroots.

But meeting him again was a déjà vu for me. His electoral success in 1996 and his 22-month stint as premier meant the end of politics for me as I knew it, and my decision to commit full-time to journalism. Sant’s short tenure unravelled the schism between the old Malta and new Malta, the Malta of Mintoff and Fenech Adami and that of the new political generation, the Malta that opposed change and the Malta that wanted to change but had to accept the world as it is.

Interviewing people is not about agreeing with them, but about learning from their opinions and outlook and confronting their thinking process. I love battling it out with people who can think and are highly opinionated. Alfred Sant is surely one of them.

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