Azores promises Brussels ‘all information’ about regional airline

The president of the government of the Azores, Vasco Cordeiro, said on Thursday that “all information” will be given to the European Commission about the doubts raised regarding regional airline SATA, asking for “responsibility and serenity” from the opposition parties.

On Tuesday, PSD/Azores vice-president Pedro Nascimento Cabral said that the regional socialist government was dragging its heels on SATA, fearing “a certain electoral penalty” in October’s regional polls.

The Social Democrat argued that the government’s request to extend the date to provide clarification to the European Commission indicates “its incompetence in managing the destinations” of the Azores “and it’s more than evident political dishonesty” towards the citizens.

The “arguments used” for the postponement, namely “geographical discontinuity and Covid-19” were, the PSD said, “lame excuses” and a “manifest insult to the intelligence of all Azoreans, even those who are assumedly socialists.

On Friday, the government of the Azores announced that the European Commission had agreed to extend the deadline for submitting the information and comments it had requested as part of the SATA rescue aid process by one month.

Recently, Brussels indicated that Portugal had to prove that the three recent capital increases in the Azorean SATA carrier were not state aid in order to ensure full compliance with the recently requested €133 million of support.

Portugal has said that the regional government of the Azores, as SATA’s sole shareholder, acted as a private investor operating under market conditions.

The country may, however, invoke “exceptional and unpredictable” circumstances for which SATA could not be held responsible to justify the financial injections, acknowledged Margrethe Vestager.

SATA’s financial difficulties have persisted since at least 2014, when the airline, wholly owned by the regional government of the Azores, began to register losses, but these were aggravated by the effects of the new coronavirus pandemic, which had a huge impact on the aviation sector.

The current board of directors of the Azorean carrier took office in January and undertook to present a strategic and business plan by the end of the first quarter of the year, but the Covid-19 pandemic forced a reassessment of the document.

In July, SATA stressed that “the context caused by the pandemic had a very significant impact” and, due to the “almost total cessation of activity, all possible measures were implemented at the management’s disposal, in a scenario where the preservation of employability was fundamental”.

In the coming months, under EU regulations, SATA will, together with the government of the Azores and the European Commission, work on a business plan that ensures the economic and financial sustainability of the group and guarantees services of general economic interest in inter-island air transport and with the outside world.