New Slovenian government rules out new flag carrier

The newly formed coalition government in Slovenia has dashed hopes of establishing a new national airline to replace the defunct Adria Airways despite two of the three parties that are part of the new cabinet in favour of the notion. In the coalition agreement signed between the three sides, it is noted that a new national airline is not envisaged. However, the trio will analyse appropriate means of support to improve the country’s air connectivity to key destinations “under economically justified conditions”. Two and a half years since Adria’s bankruptcy, Slovenia is still struggling to fill the void left by the airline, which was further exacerbated by the coronavirus pandemic.

The main party in the new coalition government was least in favour of setting up a new national airline, with the two junior partners both previously suggesting that a state-funded carrier would resolve Ljubljana’s connectivity issues. Furthermore, the incoming Minister for Infrastructure, which has been selected from a party that failed to enter parliament, made the creation of a new state airline one of her main campaign policies. Since Adria’s demise in September 2019, the government has attempted to soften its impact by offering subsidies to select airlines already flying to the country to continue doing so. It has also considered using European Union funds to establish a carrier as part of its post-Covid development strategy, however, this was struck down by the block.

Over the past two years, the Slovenian Ministry for Economic Development and Technology has turned down several offers by airlines to either establish the country’s new national carrier or station aircraft in Ljubljana, noting that none would have sufficiently improved the country’s connectivity. Prior to Adria Airways’ bankruptcy in September 2019, Oxford Economics estimated that airlines, airport operators, airport on-site enterprises (restaurants and retail), aircraft manufacturers, and air navigation service providers employed 2.000 people in Slovenia. In addition, by buying goods and services from local suppliers the sector supported another 1.000 jobs. On top of this, the sector was estimated to have supported a further 1.000 jobs through the wages it paid its employees, some or all of which were subsequently spent on consumer goods and services. Foreign tourists arriving by air to Slovenia, who spent their money in the local economy, were estimated to support an additional 21.000 jobs. In total 25.000 jobs were supported by air transport and tourists arriving by air during Adria’s last year of existence, according to Oxford Economics.