NICHOLAS IONIDES / SINGAPORE
Nearly four years after Emirates took a 40% stake in Air Lanka, a new Sri Lankan government is threatening to rework the deal, claiming it provides unfair protection for the flag carrier, now known as Sri Lankan Airlines. The 1998 deal came with a 10-year management agreement and promises of competitive protection for Sri Lankan.
The new transport minister, Tilak Marapana, says the contract provided "monopoly" privileges to Sri Lankan Airlines under bilateral air services accords, and may have to be renegotiated.
The new government of the United National Party (UNP) also announced on 21 January that it will move towards an open-skies policy governing air services, but this was greeted with confusion by Sri Lankan chief financial officer Neeraj Kumar, who said he would seek "clarification". Lack of competition is not preventing industry growth, said Kumar, who added "I think literally every airline that wants to fly to Sri Lanka is already welcome to fly into Sri Lanka."
The UNP has long been a critic of the deal, threatening to scrap the deal with Emirates if it came to power. It has already appointed a new chairman at SriLankan: Daya Pelpola, an attorney and former member of parliament, has replaced S K Wickremesinghe, who resigned soon after the elections.
Since taking operational control, Emirates-appointed managers have successfully overhauled the fleet, revamped the route network, changed the corporate identity and made other operational changes. Sri Lankan was badly hit in 2001 from the industry downturn and the loss in July of four of its 12 Airbus aircraft in an attack by Tamil separatists at Colombo's airport.
Source: Flight International
