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Europe’s Green Suicide: Carbon War May Trigger Air Fares To Rise, Airlines Could Go Out Of Business

Passengers face the threat of paying more for air travel if a trade war erupts over EU plans to impose a carbon levy on all airlines. A total of 30 countries – including India, Russia, China and the United States – have threatened to retaliate if Brussels tries to enforce its Emissions Trading Scheme on all airlines operating in its airspace.

Measures include imposing levies on EU carriers using their airports.

EU carriers could be prevented from using airspace over countries which object to the scheme.

Forcing planes to divert – for example avoiding India – would add to the cost of flying to popular holiday destinations such as Thailand.

“It could incur additional expense for the industry, which may have to be passed on to passengers,” said Paul Steele, the International Air Transport Association’s environment director.

Flight frequencies could also be cut, reducing the number seats available to passengers, which in turn could drive up the cost of travel.

The package of retaliatory measures were drawn up earlier this year by the “Coalition of the Unwilling” – the countries most incensed by the ETS scheme.

Angered by Brussels seeking to impose its writ on non-EU airlines, they signed the Moscow Joint Declaration, banning their carriers from co-operating with the scheme.

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European airlines could go out of business, warns IATA economist

European airlines could go out of business because of the continent’s economic weakness, the aviation industry’s leading economist has warned.

With the industry predicting that European carriers will lose £710m between them this year, Brian Pearce voiced fears that there could be some casualties.

Mr Pearce, chief economist of the International Air Transport Association, was pessimistic about the industry’s prospects in Europe.

“I think there is a serious risk to the financial viability of some airlines,” he said. “To an extent it depends on the economic outlook we see in Europe. We have already seen some airlines go out of business and there is a clear possibility it will continue.”

Casualties have included Spanair and Malev, the Hungarian national carrier.

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