Allowing local airlines to fly passengers mulled

MEA exclusive national carrier till 2024

The Ministry of Public work and Transportation is studying the prospects of allowing local airline firms to operate regulated passenger flights to destinations untapped by the exclusive carrier, Middle East Airlines (MEA).

On September 5, the Cabinet extended MEA’s exclusivity contract for 12 more years. It also assigned the ministry to prepare a report, to be submitted in one month, on the viability of allowing other local firms to use the airport.

Minister of Public work and Transportation Ghazi Aridi said the Cabinet decision “grants MEA full exclusivity” for carrying passengers. According to Aridi, allowing other carriers to travel to airports which the MEA doesn’t fly to requires much studies to decide whether these firms are able to successfully undertake the flights.“If studies confirm these companies are able to run flights upon the specifications, offering good services, we will give them the license to operate,” he said.

Last year, 12 local private airliner companies were operating. A few of them used to run charter flights to specific destinations, like Nakhal Travel, MENA Jet, and Med Airways. These firms however ran out of business after concerns about their violations to safety standards.

Mazen Bsat, General Manager at Med Airways said local companies are not ready to run flights to destinations not reached by MEA. “We are not able to make such (big) investments,” he said. According to Bsat, among the main destinations private airlines can fly to are Ankara (Turkey), Alexandria (Egypt), and Sharjah (UAE).

Riad Mikawi, CEO of TMA, a local cargo airline, said the company has no intention to launch a passenger carrier line. “In cargo transport we don’t have the same restrictions as in passengers, TMA can carry goods to the same destinations as MEA,” Mikawi said.

“It is imperative to grant other local passenger carriers the right to fly to the same places where MEA goes in order to improve the services and lower prices,” said Fadi Saab, former CEO of TMA and current chairman at Dogmoch group’s Aqua Capital Invest.

The majority of MEA shares are owned by the Central Bank. As long as it keeps its exclusivity, the MEA will retain a higher market value. The Central Bank governor Riad Salameh said in an interview last July that the MEA had canceled plans for a partial initial public offering citing unfavorable market conditions.

Lebanon granted MEA exclusivity in 1969 as the country’s only commercial airline. The original 20-year deal was extended until 2012.