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Serbia’s Niš airport is flying high again

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Business is coming back to Niš airport.

Tourists visit Niš to ski, hike, fish and visit spas.

Annual tourist traffic can grow to 250,000

The Serbian city of Niš is used to ups and downs. Roman Naissus, Byzantine Nysos, Slav Niš, or German Nissa, the birthplace of Emperor Constantine the Great has been an important economic, military and administrative centre since antiquity. This is why the city, located 240 kilometers south-east of modern-day Belgrade near Serbia’s border with Bulgaria, has been besieged, raided, sacked, ravaged and burned to the ground several times in its long and turbulent history.

During the 1999 NATO air-raids on Yugoslavia, a lot of infrastructure was damaged, including the runway of Niš airport which has now resumed operations with the help of donor-funded management advice provided through the EBRD’s TurnAround Management (TAM) programme.

Past poses challenges

The aviation sector of Serbia and Montenegro is a particularly challenging one, as alignment with international practices requires the unbundling of many of the former Jugoslav Air Transport (JAT) company assets into more specialised, regional companies and operators. TAM advisors who had worked on aviation issues in Lithuania went on to gain experience in the Balkans by assisting in restructuring what has since become Aeroports Montenegro. Then it was Niš’ turn.

Niš airport had been inactive for some years because of bomb damage. "Helping to restructure this company was like helping them start from nothing,” says Michael Kellaway, TAM’s senior aviation industry advisor. "But this made the project one of the most interesting we have faced so far. They wanted to get back on track and we had to sit down and find the best way to achieve this. There was goodwill and motivation from all sides, as the country's future largely relies on restructuring strategic sectors and conforming with EU rules."

From identity crisis to rebirth

Niš Airport, a municipal company, was facing a tough challenge after the bombing: here was an airport company without the facility an airport needs most – a runway. In its attempt to stay alive, the company diversified its activities and put its remaining facilities to good use. It was then that the company was crying out for help from abroad. And help did come.

The government of Norway donated €4 million for rehabilitation of the runway; with a lot of patience, the runway was completed, allowing the airport to resume operations in 2003. The municipalities of Paris and Barcelona donated buses to the airport company which began to operate local bus services. At the same time, part of the airport was turned into a truck terminal. These efforts were followed by the difficult and dangerous task, undertaken by the Serb military, of clearing the area of unexploded bombs (some of them buried several meters under the ground).

As the airport was re-opening, TAM assistance arrived, funded by the European Agency for Reconstruction. The advisors, with support from TAM’s Serbia coordinator Roman Pelka, arranged a study tour of UK airports for the Niš airport management team. The tour helped them to understand fully the positive impact of free market regulations on air transport and the most important lesson from the study tour was that airports, like all successful enterprises, must actively market themselves. The TAM team also helped company management to understand the airport’s potential, and to set their sights on achieving results through the adoption of a mid-term strategy and developing an achievable, pragmatic business plan.

Ready for take-off

One can now fly from Niš to Paris, Zurich, Frankfurt, Egypt, Turkey and elsewhere, but a lot remains to be achieved. JAT has announced plans to serve London from Niš and Thomson Holidays recently introduced flights from London to bring skiers into the Niš-area ski resorts of Kopaonik and Babin Zub. The government of Serbia and Montenegro has signalled its intention to join the European ‘open skies’ regime which will create opportunities for some of Europe’s low-cost carriers to provide better access to and from Niš.

“Our research indicates that demand will come from three sectors,” says Radisav Radojkovic, the airport’s general manager. “First, there are people travelling in relation to the local operations of international businesses such as Philip Morris. Then there are Serbs from this region who now live in western Europe but come home to visit friends and relations. Finally, there will be new tourists coming to enjoy our mountains and lakes.” Niš airport also fulfils a supporting role to Belgrade airport, providing better transportation links and thus acting as an economic catalyst for Serbian growth.

Says Mr Kellaway: "As Niš is opening to the world again, its airport will act as a bridge between Serbia, the rest of the Balkan region and the world. Niš airport has the potential to increase its activities dramatically. It now serves only 28,000 passengers per year, but this could reach a quarter of a million in a few years. The mountain and lake areas near Niš represent one of the most unspoiled habitats in Europe, ideal for relaxing holidays for summer and winter sports, and it has a number of spas that are being brought up to date.”

A British national with over 35 years of experience in UK civil aviation at a senior level, Michael Kellaway has undertaken similar consulting assignments in over 25 countries. He joined the TAM programme in 2003 and says, “The TAM formula is one of the best I have seen where, as senior industry advisors, we act in transition countries as mentors for local enterprise management teams that benefit from our wide experience.”

At the conclusion of the TAM programme, Radisav Radojkovic said, “The assistance from TAM was exactly what we needed. Michael became an integral part of our management team from day one and was able to help us focus on the important aspects of our business. It has given us the confidence to go forward and build our traffic base and assist with regenerating the local economy. We expect that the forthcoming relaxation of air transport regulation will bring us some of the benefits being enjoyed in the regional areas of EU countries.”

Written by Constantinos Bogdanos, EBRD Communications 

9 February 2006