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by Gayane Isahakyan
The open skies policy will reduce the prices of flights to Armenia by 10-50% on the average. This will allow the country to additionally increase the GDP by 1.5% or $0.3-0.4 bln AMD per annum, Arman Khachatryan, CEO of the National Competitiveness Foundation of Armenia, said at a press conference on Tuesday.
This indicator is mentioned in the program on ensuring provision of competitive and longlasting air services in Armenia elaborated on the basis of a joint survey by McKinsey&Company and the National Competitiveness Foundation of Armenia. Khachatryan thinks that Armenia will be able to reach that target in 3-4 years. "The conduct of the open skies policy will lead to growth in the country's commodity turnover and will increase the inflow of tourists", he said.
In particular, passenger operations are expected to rise by 20-25%, he said. In the meantime, 18- 23 thsd well-paid jobs will be created in the aviation sector.
In the context of the new concept "at least one cost-effective air company" will be launched in spring 2014. Khachatryan said that the air ticket prices in that company will be low, and the company will make flights to 10 cities of Europe. He failed to specify who is the founder of the company, whether the state has a share in it and whether the company has already been granted a license.
Khachatryan pointed out that in Armenia air ticket prices are by 60% higher than in the neighboring countries due to the restricted geography of flights and low competition in the market. He thinks that the open skies policy implies full liberalization of the aviation sector. Moreover, the market will be liberalized for not only foreign but also local air companies. "We suppose that by 2016 the number of foreign and local air companies in Armenia will range from 40 to 50", he said.
Air Armenia company appeared on the Armenian air market in Oct 2013 causing a significant drop in prices. Transporting cargoes since 2003, Air Armenia carried out its first passenger charter flight to Rostov- on-Don on Oct 3 and the first regular flight to Moscow on Oct 27. The company has two planes: Boeing 737-500 and Airbus 320.
The company's Executive Director Arsen Avetisyan told ArmInfo earlier that it is inadmissible that local air carriers face restrictions, while foreign companies enjoy open skies. He explained that it was the recommendation of the Government's advisor, McKinsey & Company, who believes that in order to be eligible to provide air services, a company should have a capital of at least $25mln and enough free funds to operate at least five planes within three months.
But, according to Avetisyan, in order to be able to do it, a company should have a capital of no less than $60mln. This requirement seems absurd to him as a company cannot have five planes unless it is allowed to fly: no single leasing company will give it a plane – whatever its financial status is – unless it has a license to fly. So, Avetisyan sees in this recommendation an attempt to debar national air companies from air services in Armenia and to artificially restrict their activities so as to curb their development.
In Jan-Oct 2013 1.5mln people used air services in Armenia (1.8% less than a year before).