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The European Union is a political and economic union comprising 27 states located primarily in Europe. The EU collectively represents the world's largest economy, with a GDP of USD15 trillion (2009), and counts some 500 million people within its borders. The EU operates as a single market, with a common system of laws and trade policies, with 16 states have forming a monetary union, adopting a common currency - the euro. The single market is based on the four freedoms of the EU: the free movement of labour, capital, goods and services. 22 member states have agreed to abolish passport controls between them, under an agreement known as the Schengen Agreement. Major institutions of the EU include the European Commission, the European Council, the European Parliament, the European Court of Justice and the European Central Bank.
The European Union was established in the aftermath of World War Two to bring peace, stability and prosperity to Europe. Key developments in its history include:
- 1951: The European Coal and Steel Community is established by the six founding members
- 1957: The Treaty of Rome establishes a common market
- 1973: The Community expands to nine member states and develops its common policies
- 1979: The first direct elections to the European Parliament
- 1981: The first Mediterranean enlargement
- 1993: Completion of the single market
- 1993: The Treaty of Maastricht establishes the European Union
- 1995: The EU expands to 15 members
- 2002: Euro notes and coins are introduced
- 2004: Ten more countries join the Union, establishment of the European Constitution
- 2007: Two more countries Join EU, member states sign Treaty of Lisbon.
- 2014: EU elects Jean-Claude Juncker as President for five-year term.
- 2015: Lithuania adopts the Euro as its currency, becoming 19th member of the euro area.
European Commission Vice-President, Siim Kallas, is responsible for Transport.
145 total articles
Ukraine: traffic recovery prompts Ryanair to join Wizz Air in LCC growth. Ukraine Int'l also expands
Two announcements by leading LCCs in quick succession may mark a significant development in Ukraine's aviation market. One came on 13-Mar-2016 from Wizz Air, the largest low cost airline in Eastern/Central Europe; the other on 15-Mar-2016 from Ryanair, the largest LCC (and largest airline) in all Europe.
Both expect opportunity in Ukraine's very low levels of air travel and low LCC seat share. Wizz Air, already Ukraine's leading low cost airline, will add four more new routes in summer 2017, to the four previously announced. Ryanair will enter Ukraine with 11 routes, adding competitive tension to the emerging low fares market there. The battle between the two for supremacy in Eastern/Central Europe opens up a new front.
Meanwhile, Ukraine's air traffic levels are enjoying a recovery from the slump of 2014 and 2015 caused by major geopolitical disruption and a severe recession. Passenger numbers jumped 21% in 2016.
The country's flag carrier and biggest airline, Ukraine International Airlines, has taken part in the traffic growth, but will need to ensure it can do this profitably after a period of losses. Risks remain, but the conditions are in place for further growth in Ukraine's air traffic.
Over seven months after the UK voted in a referendum to leave the European Union, the longer term impact on aviation remains uncertain. The UK Prime Minister Theresa May will almost certainly gain parliamentary authority to trigger Article 50 by her planned deadline of the end of Mar-2017, taking the UK out of the EU by Mar-2019.
On 17-Jan-2017 Mrs May set out 12 principles which will guide the UK in its negotiations with the European Union over the terms of its exit. These principles formed the basis of a White Paper outlining the government's planned approach to the Brexit negotiations. Among other things, the UK does not plan continued membership of the EU Single Market and wishes to control immigration.
There is now a clear timeframe for the Brexit negotiations and a broad framework to guide the UK government in these talks, but still no clarity for aviation. There are obstacles to the UK's continued membership of the European Common Aviation Area, and a bilateral approach may now be more likely. The UK Transport Secretary wants the "best possible access to European aviation markets", but is not yet able to say how that can be achieved.
Dubrovnik, in the far south of Croatia on the Adriatic Sea, has the country’s third busiest airport after Zagreb and Split. The airport is leisure-oriented with a mix of FSC/network carriers, LCCs and charter carriers.
The economy of the small city is heavily reliant on tourism, which the airport supports by way of handling almost two million passengers annually. Because of the unique nature of that tourism Dubrovnik Airport has no outright competitors either within or outside Croatia with the exception of Split Airport to the north, whose profile is very similar.
This report examines Dubrovnik Airport by way of several sets of metrics, looks at the airports that are rivals to it, at its construction activities and its current and projected ownership.
Linking Asia with North America has been the market cornerstone for Korean Air and Cathay Pacific while producing a growth market for relatively new entrants like ANA and EVA Air. Yet, while northeast Asian airlines have the geography for profitable nonstop North America flying, southeast Asian airlines are challenged in serving the route.
Singapore Airlines feels the need for a significant North American presence to diversify its network and offset pressure from Gulf airlines, which have profoundly weakened SIA in its core Asia-Europe and Australia-Europe markets. Although Singapore Airlines plans to resume nonstop North American flights, these are token services for strategic purposes.
The primary objective has to be securing more fifth freedom rights for one-stop service. Singapore is encouraging the ASEAN bloc to secure open skies with Japan, Korea and the EU since open skies will entail unlimited fifth freedom rights. Korea is unlikely to agree, with Japan hesitant. Fifth freedom liberalisation is a contentious item in the otherwise benign EU-ASEAN negotiations. Countries worry that granting unlimited fifths opens Pandora's box to growth – not just from SIA, but any number of airlines that are quiescent today but could aspire to be powerhouses in the future.
Part 1 of CAPA's Brexit follow-up report assessed the ASK exposure of UK and non-UK airlines to market segments where existing traffic rights could potentially change once the UK finally leaves the European Union. This second part reviews recent comments by leading European-listed airlines on how they see the impact of Brexit, both in the short term and in the longer term. Most of them acknowledge that there are considerable uncertainties, while simultaneously insisting that they will not be significantly affected in the long run.
There have been two initial impacts on airlines. First, Brexit has added to economic uncertainty, thereby muting demand and lowering yields. The magnitude and duration of this impact is unpredictable. Secondly, the consequent weakening of the GBP has made outbound international travel from the UK more expensive and less appealing, and lowered the value of GBP revenue earned by airlines.
The longer term impact will depend on whatever new traffic rights regime is negotiated between the UK and the EU. As a number of the airlines have acknowledged, this remains unknown and is, indeed, unknowable until the UK formally triggers its exit from the EU and then completes its two-year exit negotiations.
CAPA's previous analytical coverage of the UK referendum vote to leave the European Union flagged several questions surrounding UK airlines' future access to the European single aviation market. Traffic rights post-Brexit will depend heavily on the wider relationship between the UK and the EU and its markets. In turn, this may depend on how far the UK is prepared to go in embracing the EU's four key freedoms: the movement of capital, goods, services and people.
The UK has not yet triggered its formal two-year exit negotiation period and all aspects of its future relationship with the EU remain unknown. However, politicians in the UK are very reluctant to accept the continued freedom of movement of people, so existing airline market access is likely to be compromised in some way.
Rather than speculate on how negotiations might proceed, this report identifies the main market segments that could be affected by changes to the traffic rights regime, and evaluates the ASK exposure of airlines from the UK and from countries in Europe's single aviation market to these segments. A further report will review recent comments by Europe's leading listed airlines on how they see the impact of Brexit.