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Wednesday, October 20, 2021

Bosnian Airports Set To Benefit From €1.5 Million In Subsidies

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Bosnian airports are set to benefit from a boost of nearly three million convertible marks (BAM) in subsidies, which is the equivalent of $1.7 million. The money will be distributed by the Federation of Bosnia and Herzegovina, which is a constituent part of the country that is Bosnia and Herzegovina. The four countries that will receive the funding include Tuzla, Mostar, Sarajevo, and Bihać.

FlyBosnia
FlyBosnia operates to two of the airports that will receive a subsidy: Mostar and Sarajevo. Photo: FlyBosnia

The federal funding

SeeNews reports that the government of the Federation of Bosnia and Herzegovina has decided to provide subsidies to its four airports. These will go to the capital of the entity and of Bosnia and Herzegovina itself, Sarajevo. They will also go to Mostar Airport, Tuzla Airport, and Bihać Airport. The last of these, Bihać, does not yet exist.

The money that the federation has allocated totals 2.9 million Bosnia and Herzegovina convertible marks, which is the currency of Bosnia and Herzegovina. The equivalent amount is 1.5 million EUR or 1.7 million USD. In a country where GDP per capita is $6,000, this is not an insignificant amount of money.

The money has not been divided up equally, but it is also not being divided by the size of the airport. Instead, it will be distributed by need. The impact of the COVID-19 aviation crisis has been particularly hard for Bosnia and Herzegovina, which has a national airline that is still an un-established start up with a limited route network. The country is also not in the European Union, and so its citizens still face travel restrictions. Even neighboring Croatia recently introduced a quarantine requirement for arrivals from Bosnia and Herzegovina, though this has since been removed.

Wizz Air, Italy Flights, Coronavirus
Wizz Air is one of the biggest customers for the airports in Bosnia. Photo: Getty Images

What will the money be used for?

A whole third of the money will go to Mostar Airport and Tuzla Airport each. Both of these will receive just under one million BAM. The remaining third will be split unevenly between Bihać and the largest airport in the country, and the capital of both the Federation of Bosnia and Herzegovina and the country of Bosnia and Herzegovina itself, Sarajevo.

Mostar Airport will use its one million BAM to cover its operating expenses, which remain uncovered by revenues because there is presently no single airline that operates scheduled flights there. Even charter services, which Mostar used to cater for a lot because of its proximity to the Catholic shrine of Međugorje, have dried up. Mostar Airport will also use the money to “bring its operations in line with anti-coronavirus measures and supervision”. These are the requirements it has been given by law, and which are fairly costly to meet even as the airport has no scheduled flights.

Tuzla Airport, which is in a much better position because Wizz Air has re-instated a whole network in this Bosnian airport, will use its one million BAM to purchase raw materials, energy sources, small inventory, and equipment.

Tuzla Airport
Tuzla International Airport serves Wizz Air only. Photo: NeXtro via Wikimedia

What will Sarajevo and Bihać do with the money?

Sarajevo Airport, despite being the largest in the country and despite carrying the most passengers annually, will only receive 700,000 BAM. It will use this to finance its operating costs. They too have suffered from a significant number of cancellations.

Interestingly, some of the money will also be awarded to Bihać Golubić Airport, which technically does not exist as an international airport because it is still under construction. It will receive 300,000 BAM for its own operating costs, which is curious since the airport does not actually have any. The airport is not even visible on online aviation radar services.

Do you think Bosnia should be subsidizing its airports? Let us know what you think of this story in the comments below.





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