He is chief executive of Malta’s only airport and after just six months at the helm, Austrian Markus Klaushofer talks to Kurt Sansone about his vision for the company.

Malta International Airport has had quite a promising year with the latest passenger results for August showing record numbers. How is it looking for the rest of the year?

Competition for Skyparks’ office space is healthy. Lack of competition makes you lazy and fat

We were initially very apprehensive when we discussed this year’s forecasts. We were not expecting another record year like 2011 because of the crisis in Europe.

But at this stage it looks like we will have more passengers than last year, which is very good. When I compare this to other tourist destinations in Europe it is definitely a positive achievement.

What do you attribute this record to?

I have only been here for just over six months but what I saw was a total dedication to tourism. It felt like being part of a team: the airport, the airlines, the Malta Hotels and Restaurants Association, the Malta Tourism Authority, the Government and also the Opposition are very interested in tourism.

There is a team that wants to ensure a good product so that passengers come here. I see some very good teamwork here in Malta and this is not normal.

I have seen other countries where stakeholders have competing interests. But everyone here understands the need to have a big cake to be able to share it.

The European Commission has approved Air Malta’s restructuring plan and the airline is now on the road back to recovery. During the past year there was friction between the airline and MIA over airport charges, an issue taken on board by the pilots’ association. How are relations with Air Malta now?

We have good relations. In every airport in the world the home carrier always claims that charges are too high.

I haven’t heard any home carrier that says everything is fine.

They obviously have to push for better deals. But when you see the costs incurred by airlines, airport charges are a small component. Fuel costs represent an airline’s major expense.

It is their job to always push us to offer a better service and we try to achieve this by ensuring quality. But we both have one product to offer.

Passengers do not distinguish between an airport and an airline. For them check-in belongs to the airport as much as the airline. We are very reasonable with our charges and we have waived airport fees in the winter.

I don’t know how many airports our size do that.

This is the second year running that you have waived airport charges in the winter. What is the rationale behind this?

In summer time everyone is happy: the hotels, the restaurants, the airlines and us.

In winter everyone suffers because we obviously don’t have ski tourism here.

We are part of the team and we want to contribute by waiving the landing charges. It is a joint effort to make the island more attractive during winter time.

There was a strategy that started being developed by your predecessors to attract non-travellers to make use of the services, shops and restaurants at the airport. Where will this lead in the future?

It is a general strategy adopted by a lot of airports to create what are known as airport cities.

A very good example is Amsterdam. This means the airport will be marketed as a destination in its own right because there are shops, a pharmacy, a supermarket, restaurants, bars and other services and it would be stupid to expect only passengers to use them. We would like to do more.

On the land side there is potential. We are exploring opportunities. We will be opening the Skyparks business centre, which was a huge investment of around €18 million, and we are interested to continue investing.

We need to look at the projects and see if they make sense.

Given the presence of two foreign shareholders, our projects will be competing with others abroad financed by the same shareholders. They will query the returns on any investment, whether it makes sense and whether the country is friendly towards investors. Up to now we have been quite successful.

The retail function within the airport has expanded rapidly. Is there spare capacity to continue adding new shops?

Within the existing terminal everything is rented out. We are now optimising the retail outlets.

The new Costa coffee outlet is a top brand and an improvement over its predecessor. But we’re also discussing a land-side master plan.

MIA has large tracts of land available for development. How will you utilise this?

The airport has a very particular characteristic. Whenever people from the north come here they notice the palm trees and olive trees and the distinctive architecture. They feel relaxed and happy.

The architecture has to be distinctive. We could have built Skyparks at a much reduced cost but we chose to invest in quality.

We have to do something that is practical but that also looks nice. We have to find the right way forward with our architects and make the relevant investments.

I’d rather wait a bit longer and have a good project.

What concrete projects are you looking at?

We have ideas. But it all boils down to whether the numbers make sense. It is too early to identify the projects that we may consider.

Skyparks Two could definitely be an option. But for the rest we have to analyse the numbers.

The Government has bought Air Malta’s head office as part of the restructuring process. Will MIA be interested in buying the land?

At the moment we have enough space in our hands. But an airport city makes sense if everything is within walking distance and Air Malta’s land is cut off from the terminal. Anybody working at Skyparks can walk to the terminal and visit the pharmacy and supermarket.

It will not benefit the customer if services are not within walking distance because this will create additional travelling, apart from not being environmentally friendly.

Are you considering building an airport hotel?

There is a chance to develop a hotel but on the flip side a 20-minute drive can take a customer to a beach-side hotel. What will a customer choose?

There could be the need for a hotel to be used by fly-and-cruise passengers but it is something that will have to be discussed.

I wouldn’t say no if there is a feasible business plan and an operator who is interested.

When will Skyparks officially open its doors?

It will open at the end of the month. We are very happy with an 80 per cent occupancy rate even before opening.

You are competing with office space in other prime locations.

Singapore was a jungle 50 years ago when they presented their vision. Everybody laughed, but nobody is laughing today

Competition is healthy. Lack of competition makes you lazy and fat. Our advantage is that Skyparks is accompanied by perfect infrastructure.

You have the bus connection, the terminal, the taxi stands, restaurants from Burger King and McDonald’s to the newly opened top class wine bar and cafeteria Talbot and Bons, all in one location.

It is by far the best office block. We ensured the highest level of technical specifications, including environment-friendly measures such as photo-voltaic panels and a water reservoir.

For huge companies the environmental aspect is important.

Skyparks was obviously a risk for us but with the high occupancy rate achieved so far is a huge success, which is not normal, especially at a time of crisis. I am very happy with the guys in our marketing team who did a tremendously good job.

Skyparks had long been on the drawing board.

That is how we work. It always boils down to numbers. We would rather take a bit longer but do it absolutely properly. This is partly the success of Skyparks.

The shareholders must be happy.

They should be happy but shareholders will never tell you that because they always want more. But to be fair, we got very good comments from them.

It has often been mentioned that MIA could serve as a passenger transit hub. Is this a feasible option?

In the short term no but in the long term absolutely yes.

With some small adjustments the airport is ready to serve as a hub. We do have some hub traffic, especially to Libya. But to establish a hub you also need an airline that is selling the product as a hub. With Air Malta undergoing a restructuring process it is difficult but it’s entered the right markets, like Russia and Libya.

I think there is a very good chance to develop a hub for cargo by having an agent such as TNT or DHL basing aircraft in Malta. It is ideal because the country is part of the EU, the people will be safe here and the location is very close to emerging markets in North Africa. This is something that makes sense.

I compare Malta today, after the Arab Spring, to Austria when the Cold War ended. We were at the end of the world and two-thirds of our borders were closed off with a 10-metre high fence. There was nothing beyond the fence. Now, Malta, like Austria, will see opportunities increase as northern Africa changes.

How do you view the developments in Libya?

I cannot comment because I come from the north. The Maltese are the only Europeans who can understand what is going on in Libya. I think it will take some time to stabilise though.

Does it present an opportunity?

I think so. Obviously, if you want to invest and have good returns it is best to go in at risky times. You can take the risk and expect high returns. You don’t take the risk and the margins are much lower. But I think in the long term Libya will stabilise.

You have been in Malta for six months. Where would you like to take the company in your term of office?

In the short term I would like to control costs. We benefit from the problems of other countries, such as Greece, and this means we have to be flexible enough to change and attract new business.

I want to strengthen the revenue streams and offerings for non-aviation customers. But more importantly I want to ensure quality is maintained. Everyone has to be dedicated to quality.

In the long term I would like to develop a cargo sub hub. By working together we can do it. It is not always a question of size.

Singapore was a jungle 50 years ago when they presented their vision. Everybody laughed but nobody is laughing today.

There are strategic options in front of us and it all boils down to whether we will manage them well or not. I believe we will.

I also want to strengthen the company’s environmental commitment by embarking on energy saving projects. It hurts to see a lot of rain going to waste and then electricity is used to transform sea water into drinkable water.