Daily Israel Report

Israel Signs 'Open Skies' Deal, Hopes for Lower Plane Fares

At a festive ceremony Monday, Israel officially signed the “Open Skies” agreement with the European Union
By David Lev
First Publish: 6/10/2013, 4:47 PM

El Al airplanes
El Al airplanes
Flash 90

At a festive ceremony Monday, Israel officially signed the “Open Skies” agreement with the European Union. The agreement, under negotiation for several years, was signed by Transportation Minister Yisrael Katz and Airports Authority director Giora Rom with EU transport ministers.

The agreement was ratified by Israel's cabinet in April, setting off a strike by El Al and other Israeli airlines. El Al, Israir, and Arkia have all expressed fears that they would not be able to compete with the low-cost European carriers that the deal would require Israel to accommodate at Ben Gurion Airport.

The strike ended only when the government agreed to pay for the lion's share of security costs borne by the airlines, a back-end “subsidy” that the government and airlines hope will help even the playing field with the European carriers.

In order to enable the Israeli airlines to adjust to the new situation, the agreement will be implemented over five years. After that time, it is expected that there will be much more air traffic between Israel and Europe – and lower ticket prices, resulting from the increased competition. Commenting on the agreement after it was ratified earlier this year, Finance Minister Yair Lapid said that the agreement was “good for Israel, and will lead to the lowering of prices and increased competition. It will not cause a loss of jobs, as the airlines here fear, but rather the the opposite.”

The agreement will supersede any arrangements Israel currently has with individual European countries, Katz's office said.