Good Money after Bad: Questions Asked of Taxpayer-Funded Air Serbia Rescue

A 100 million-euro recapitalisation of Serbia’s national airline, Air Serbia, is just the latest injection of taxpayer funds into the struggling company. But how many Serbian citizens know it?

On the last day of 2020, Serbian national airline Air Serbia announced that the state had increased its stake in the company from 51 per cent to 82, diluting the share held by Abu Dhabi-based Etihad Airways from 49 per cent to 18.

In a brief statement, the airline – created when Etihad bought a minority stake in Serbia’s loss-making JAT Airways in 2013 – said it had requested recapitalisation to offset the effects of the COVID-19 pandemic and that Serbia’s Commission for State Aid Control, CSAC, had signed off on the move as in line with all legal regulations.

And that was it. No other details were given, not even how much money had gone from state coffers to keep the airline afloat amid unprecedented pressure on the global aviation industry.

Serbia’s ruling Progressive Party has long touted the creation of Air Serbia as a success story of partial privatisation. But not all the contracts between Serbia and Etihad were made public, so the people of Serbia have been given little real insight into how much of their taxes have been spent to keep its planes in the air.

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