Aviation Agreements with Other Countries Strengthened Azerbaijan�s Confidence to EU � EU Representative

In February 2019, the Director General of the European Commission on Transport and Mobility, Henrik Hololei, visited Baku for transport talks, under which the current situation with the aviation agreement was also discussed.

The EU first proposed this agreement in 2013. Then the negotiations were suspended. They were resumed in 2017. However, despite the optimistic statements of both parties, negotiations on the agreement have not yet been completed. During this time, the EU has signed similar agreements with Georgia and Armenia, while Azerbaijan remains the only country in the region that has not opened its sky to European airlines. In an exclusive interview with Turan, Henrik Hololei spoke about the situation at the talks and about the expectations of the parties from the aviation agreement.

1. How do you assess your meetings in Baku from the point of reaching mutual understanding on the aviation agreement?

We have come a long way since the beginning of the negotiations in 2013. During those 6 years, the EU has signed agreements with other close partners, and their overwhelmingly positive impacts certainly strengthened the trust of the Azerbaijani authorities in the EU as a partner and in the potential positive effect of an EU-Azerbaijan aviation agreement. I also felt it during my meetings with Azerbaijani government representatives. I believe we have managed to reassure the government about our intentions and to clarify our position regarding the outstanding issues. I hope this will pave the way for a rapid resumption of the negotiations which, given the limited number of issues still under discussion, could be concluded very soon.

2. Do you feel the wish of the Azerbaijani side to finalize successfully negotiations on aviation?

Yes, in all my meetings with senior government representatives I sensed a shared will to conclude the aviation agreement very soon. Both sides are clearly committed to resolving the few outstanding issues and want to make sure that it is a genuine win.win outcome for both sides..

This agreement will bring Azerbaijani airlines, airports and airspace to a new level of integration with the EU and the world. Other countries of the region have recently signed agreements with us, and I believe that our Azerbaijani friends are aware of the unique window of opportunity to keep and further develop Baku in the race as one of the key transportation hubs of global importance, both for passengers and freight.

3. On which issues the sides cannot reach an agreement?

There are a few elements where further clarifications are still needed - including a few transition dates. But I don"t think that any of the issues still on the negotiation table are insurmountable. I am confident that the few outstanding issues can be reconciled through discussions at the technical level.

4. What are conditions of the Azerbaijani side?

Our Azerbaijani partners understandably want to make sure that the agreement does not negatively affect their national carriers, in particular AZAL. Experience from all the aviation agreements we have signed so far has been very positive for the national carriers of our partners. Open skies means wider business opportunities, more connections and more traffic. We have shared this evidence with the Azerbaijani side and we believe this will help overcome their concerns and reassure them that the agreement will be a good success for both parties.

5. What will be advantages of signing the agreement?

There will be direct and indirect positive effects. The direct benefits are better connectivity (increase in the number of routes and frequencies) and lower fares. More people will travel by air and bring revenues to the airlines more specifically and aviation industry more generally. In our previous agreements, these effects were significant: for example, since the signing of the agreement with Israel, traffic between Israel and the EU doubled and the number of airport pairs (direct connections) tripled. Since we signed the agreement with Israel, we have each year added one million more passengers travelling between Israel and the EU. The effects on national carriers were equally very positive: in Morocco, the business of national carriers grew by 60%; in Serbia - by over 100%.

There are also important indirect effects, amongst which a significant rise in the number of tourists visiting the country which helps to develop tourism industry and related infrastructure and facilitation of business contacts.

In the case of Azerbaijan, possibly the single most important effect will be the possibility to use the full potential of Baku airport. It is a very modern 5-star airport with excellent facilities for passengers and cargo, but is currently not even used to 50% of its capacity. It has all the necessary infrastructure for becoming an important intercontinental transportation and logistics hub, and the aviation agreement with the EU will help to realise its potential.

The agreement will also align EU and Azerbaijani aviation regulations and standards to the highest level in the world in areas such as safety and security.

6. What impact will the signing of the aviation agreement have on the price policy of the air services?

The aviation agreements will bring more competition on routes where previously there was a monopoly, or on which no direct connections were previously offered. As a result, customers will benefit from lower average fares. For instance, the average rates fell by 61% on EU-Morocco connections and by 27% between the EU and the United States, since the signature of the respective agreements. Thanks to the accompanying increase in traffic, this fall in the rates did not harm the carriers; on the contrary, their conditions enhanced after the signature of the agreements.

7. In your opinion, what is the level of interest of the European aviation companies towards the Azerbaijani direction?

The market for connections between the EU and Azerbaijan is relatively small. Judging by past experience, I would expect increased interest from European low cost carriers, who will offer new point-to-point connections to cities in the EU, mainly serving tourists. I do not expect however a sudden rush on Baku by traditional carriers. However the agreement would offer a good opportunity for Azerbaijani carriers to transport passengers between the EU and Asia, benefiting from the excellent infrastructure of the International airport in Baku. But it gives a great opportunity to show this wonderful country to more and more people around Europe and helps to develop the tourism cluster. This in turn also raises the interest of EU carriers to fly more to Baku. -0--