OAG Travel News

JAKARTA, Indonesia -- The European Union on Thursday decided to keep Indonesian airlines on a blacklist which prohibits them from operating in any of the grouping's 27 member states, according to an official familiar with the decision.

A number of Indonesian airlines -- including Mandala Airlines, which is controlled by Indigo Partners, a U.S. private-equity firm that invests in the airline industry -- have been pushing to get off the blacklist and had expected that to happen on Thursday.

But the European Commission, the EU's executive arm, found that Indonesia's civil-aviation authority had failed to improve its monitoring system to ensure local carriers stick to global aviation safety standards, according to the official.

Indonesia has suffered a number of fatal incidents in recent years, including the New Year's Day 2007 crash of an Adam Airline Systems plane, killing all 102 people on board.

The European Commission and the EU's air-safety committee "recognized that considerable efforts have been undertaken by the Indonesian Civil Aviation Authority and the Indonesian airlines to improve the air safety situation and stressed that some progress has been achieved," the commission said in a statement Thursday. "However, it was concluded that the Indonesian authorities have still not developed and implemented an efficient oversight program on any of the carriers under their regulatory control."

Indonesia's airline industry has boomed since deregulation almost a decade ago, making it one of the fastest growing anywhere in the world. Some 39 million people traveled by air last year, up from 12 million in 2002, according to official data. There are now almost 50 Indonesian airlines, up from just a few state-owned operators a decade ago.

But the growth has come at a cost to safety. An audit last year by the United Nation's International Civil Aviation Organization, or ICAO, which sets global safety standards for the airline industry, found Indonesia fell well short of those benchmarks.

Indonesia's civil aviation authority lacks funding, the report said, and its officials have insufficient powers to reprimand airlines that did not take sufficient safety precautions.

The ICAO also noted that training of pilots and safety maintenance personnel was poor. The report gave Indonesia only two points out of 10 for "Technical Personnel Qualification and Training."

The EU banned Indonesian airlines from landing in its member nations last summer following the ICAO report and a number of deadly crashes in Indonesia.

The ban has come at a cost to Indonesian airlines. Although none flew directly to Europe at the time of the ban, the EU's decision has meant that European travel agents are unable to sell packages that include internal flights within Indonesia. That has hurt Indonesia's tourism industry, centered on the resort island of Bali.

Some Indonesian airlines – Mandala, state-owned Garuda Indonesia and Airfast, which operates charter flights and cargo carrier PremiAir – had asked the EU to exempt them from the blanket ban.

The commission found that efforts by Indonesia to improve monitoring of those four airlines to fast-track them off the blacklist had been slow to start. "No detailed information has been given regarding the surveillance of all other Indonesian air carriers in both the areas of maintenance and flight operations," the Commission said in its statement.

Warwick Brady, chief executive of Mandala, said he was disappointed by the EU's decision. "We at the airlines do very a good job and we have met international standards," he said. "It would be very reasonable for EU to consider lifting the ban for limited airlines."

Indonesia's government also reacted angrily. A foreign ministry spokesman, Teuku Faiza Syah, called the decision "irrational and political." The country has been working hard with ICAO to take corrective actions set out in last year's audit, he said.

ICAO hasn't yet formally assessed these efforts, the commission noted

Source: Tom Wright  www.online.wsj.com