BELGRADE (Reuters) - Belgrade’s main airport plans to invest 20 million euros over two years in expanding capacity to cope with a sharp increase in traffic, a senior official said on Friday, with the government hoping to attract bids to run the airport.
Ana Lukovic, director of development and investment, told Reuters that the ultimate goal “is to make Belgrade a regional hub.”
Traffic has increased since 2013 when Abu Dhabi’s Etihad bought a 49 percent stake in indebted flag carrier JAT, rebranding it as Air Serbia and introducing new routes.
“We are close to the limit of our capacities at the moment,” Lukovic said in an interview. “That’s why we decided to start a short-term investment cycle.”
Shares in Aerodrom Nikola Tesla - of which the state holds 83.15 percent - have shot up in value by nearly 40 percent since the turn of the year, driven by a rise in profit to 3.4 billion dinars (28.22 million euros) in 2014 from 13.3 million in 2013.
Once closed to international air traffic during a decade of war and sanctions under late Serbian strongman Slobodan Milosevic, the number of passengers using the airport rose by more than 1 million last year and is expected to hit 5 million this year, Lukovic said, nearing its current capacity of 5.5 million.
Lukovic said the airport would spend 15 million euros of its own funds in expanding Terminal 2 by building 8 new gates and a new passengers’ area. On completion in mid-2016, the terminal will be able to host long-haul aircrafts.
Another 2 million euros will be spent on renovating Terminal 1 and 3 million on new de-icing equipment.
“Once this investment cycle is completed we will expand capacity to 7, 7.5 million passengers a year,” Lukovic said.
Cargo traffic at the airport was up 13 percent in 2014, driven by the new Air Serbia and by Turkish Airlines cargo flights.
“We have seen real boom since the national flag carrier was transformed,” Lukovic said. “We expect to see another boom once long-haul flights start.”
Air Serbia flights account for 50 percent of all air traffic at the airport. The airline hopes to start flights to the United States by the end of the year.
The government says it plans to offer the airport on concession, with Europe’s biggest construction and concession company - French Vinci - already expressing interest.
Editing by Matt Robinson/Jeremy Gaunt