Talks with Brussels on future of Air Malta

No information is being given by the government on talks with the EU over Air Malta’s future as it attempts to find a way to pump more money into the national airline that made a €31 million loss in last financial year.

The Times is informed that the talks also deal with the drawing up of a new business plan for the carrier that will see it introducing cost-cutting measures to be in a better position to compete.

The Finance Ministry would not comment and did not even want to say whether the talks would lead to direct state aid. To do so would require the EU’s green light although no such consent would be necessary if the government opts for a recapitalisation exercise.

Sources close to the European Commission said talks over Air Malta’s prospects had been going for months and involved top officials from the government and the airline.

“Talks are ongoing and there have been meetings in Brussels involving the top hierarchy of the Office of the Prime Minister, the Finance Ministry and Air Malta,” the sources said.

“However, so far, Malta has not yet presented any formal notification to the Commission on state aid required for Air Malta,” the sources noted.

Questions sent to the ministry remain unanswered, bar a comment that it was still “premature to comment on this issue”.

Following the announcement of Air Malta’s loss last January, the ministry had said the government would be having talks with the Commission on a recapitalisation programme for the company that respected EU state aid rules.

Commission sources explained that EU rules permitted granting state aid to Air Malta “as long as this is just a one-time opportunity and is tied to a restructuring programme aimed at putting the national airline on a sound financial footing”.

In the past years, the EU gave the green light to similar state aid packages to other national airlines, the most recent being Alitalia.