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March 10th, 2012

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Despite winning awards for efficiency and setting records for passenger numbers, city mayor Frank Jensen (Socialdemokraterne) contends that Copenhagen Airport should be run by the state.

Currently the airport is considered one of the most influential centres in Northern Europe, but significant growth in airports in Stockholm, Oslo and Helsinki, combined with an ambitious project in Berlin, has threatened to depose the Copenhagen hub as a regional powerhouse.

Jensen told the business newspaper Børsen that the City Council strongly supports having a more active role in the operations of the airport and wants the state in on the idea.

“We, here at the council, look favourably on the possibility of investing further in the airport," he said. "Regrettably, the state has taken a more passive stance to the airport since selling the majority of its shares.”

He also maintains that the state should look at buying a stake in the Scandinavian airline, SAS. Jensen was particularly concerned about a scenario in which SAS could be bought out by a larger airline such as Lufthansa, which he said would present dire consequences.

“I strongly encourage the three Nordic governments to shelve any plans to sell their part in SAS," he said. "It is absolutely essential for future jobs in the Øresund region and Denmark that we strive to maintain Copenhagen Airport as the most important air traffic hub in Northern Europe.”

Since the airport became a listed company in 1994, the state has gradually sold off shares and has now become a minority stockholder, owning 39,2 percent. Australian venture capital firm, Macquaire Airport, obtained the stock majority in 2005 and last summer the Canadian pension fund, Ontario Teachers’ Pension Plan, purchased 30 percent of the stock from the Australians.

Having recently set aside a substantial number of funds to remain competitive, the airport may also find Jensen’s comments of interest and a deal could be forthcoming. Professor Per Homann Jespersen from Roskilde University told Børsen that the council could probably raise the necessary finances the same way it did when constructing the Metro.

“In recent years, the airport has begun to face more strategic challenges and as a result I think that they would welcome the council into the fold," Jespersen said. "It is very sensible that part of the ownership remains in the hands of the public sector, as they can make sure the airport acts in a way that benefits Denmark and the region.”

While Jensen’s suggestion has gained some political backing, the finance minister, Bjarne Corydon, told Politken newspaper that the financial down period makes the proposal an unrealistic venture at the moment.

“Considering that the public sector is battling steep deficits at the moment, the acquisition of companies is not exactly at the top of the government agenda, so I don’t really see the state and City Council attempt to buy back the Copenhagen Airport,” he said.

Another criticism of the proposed deal is that the airport is currently being run smoothly and that a shift to public hands may compromise the quality of the airport's present status, Martin Ågerup, the director of liberal think-tank Cepos, told radio station Radio 24syv.

“The state and council don’t necessarily have the qualifications required to run an airport," Ågerup said. "Despite the obvious interest that the airport holds to the Danish society, politicians don’t have a great track record in running things. Just look at the IC4 train scandal. It’s best that it remains privatised.”

The long-term financial consequences for the region could be severe if Copenhagen Airport fails to maintain its position as a leading north European travel hub. A report from interest group Copenhagen Capacity stipulated that just ten long-distance routes out of Copenhagen generate approximately one and a half billion kroner to the Copenhagen area.

“It is imperative that we have a well developed airport with an efficient flight network, as it attracts business to the capital,” Peter Højland, chairman of Copenhagen Capacity, told Børsen.

The market value of the airport currently stands at around 17 billion kroner.