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EU Holding Urgent Talks On Airspace Closure Crisis

The ash cloud has caused travel chaos for millions of people

The ash cloud has caused travel chaos for millions of people

(RFE/RL) -- European Union transport ministers are due to hold emergency talks today to discuss a possible easing of restrictions that have led to the shutdown of much of Europe's airspace because of the threat to aircraft from volcanic ash.

The five-day-old crisis has cost the airline industry hundreds of millions of dollars, millions of passengers have been stranded, and importers and exporters have been hit.

Speaking to reporters in Brussels on April 18, European Transport Commissioner Siim Kallas said the disruption was "unsustainable.”

"This kind of thing has never happened before. It is clear also that this is not sustainable; we cannot go ahead and just wait until the ash cloud disappears," Kallas said.

Kallas added that the disruption could deal a bigger economic blow to the airline industry than the September 11 attacks on New York and Washington in 2001, when U.S. airspace was closed for three days. But Kallas said the European Union could not compromise on passengers' safety during the crisis. He also reiterated that airlines had an obligation to compensate passengers who had been unable to travel because of the crisis.

Spain, current holder of the rotating European Union presidency, called a video conference among transport ministers later today to discuss emergency plans.

The European Commission is also to set up a group to assess the impact of the ash cloud on the economy and European travel.

Slide show mapping the fallout's predicted course.

The European aviation control agency Eurocontrol, said some 63,000 flights had been cancelled since April 15.

Brian Flynn, Eurocontrol's deputy head, said that "approximately 50 percent of the land area of Europe is outside the area of potential risk of the volcanic ash cloud. That is enabling the opening up of a number of airports and airspaces, and our best estimation at the moment is that about 30 to 35 percent of the flights foreseen for today will be able to operate."

For travelers, businesses, and financial markets, the biggest problem is the sheer unpredictability of the situation.

But Chatham House senior economic fellow Vanessa Rossi tells RFE/RL that concerns have grown about the wider implications of the disruption.

"It clearly has begun to have impacts on the transport in other ways, for example the short-life shelf products in the supermarkets, of food products, of flowers and so forth," Rossi says. "But also, there are some of the emergency services involved here. Of some concern is of course the movement of people for medical reasons and some related to the troop movements in areas such as Afghanistan."

An unnamed senior U.S. official warned of potentially serious damage to military jets from volcanic ash after glass buildup was found in an engine of a NATO F-16 fighter plane. The official did not identify the location, the exact time of the incident, or the nationality of the aircraft.

Britain, where the crisis is threatening to become an issue in the campaign for next month’s elections, said today it was dispatching two Royal Navy warships to help bring home its nationals stranded by the airspace closures, notably in France.

The British travel agents' association ABTA said about 150,000 Britons were stranded abroad. Companies reported staff had been unable to get back from Easter holidays abroad, while hospitals said they were cancelling some operations because surgeons were stuck in far off places.

The shutdown poses a growing problem for airlines, estimated to be losing $200 million a day, and for the millions of travelers stranded worldwide.

'European Embarrassment'

As losses from the grounding of aircraft pile up, airlines called for a review of no-fly decrees after conducting test flights at the weekend without any apparent problems from the ash cloud.

The International Air Transport Association expressed its "dissatisfaction" with how governments have managed the crisis, "with no risk assessment, no consultation, no coordination, and no leadership." Director-General Giovanni Bisignani called it a "European embarrassment."

The Association of European Airlines (AEA) said it wants an "immediate" assessment of the airspace restrictions. AEA spokesman David Henderson told Reuters in Brussels that the industry had been through "the worst 18 months in its history" and that the current crisis could cause "severe difficulties" to many European airlines.

"There are very, very few airlines around Europe at the moment that are making money or making money in any significant way, and there remain some of them which are, shall we say, on the critical list and this latest episode could well cause some very severe difficulties," Henderson said.

On the stock market, airline stocks slumped on April 16, with the Bloomberg EMEA Airlines Index falling 3.1 percent, the steepest decline in 2 and 1/2 months.

For some businesses dependent on fast air freight, the impact has been immediate. Kenya's flower exporters said they were already losing up to $2 million a day. Kenya accounts for about a third of flower imports into the European Union.

The world's largest package-delivery firm, United Parcel Service, began trucking items from Asia through Istanbul and into Europe.

Meanwhile, oil prices extended losses today on expectations that disruption to air travel will undermine the global economic recovery and crude demand.

Benchmark crude for May delivery was below $82 a barrel at midday Singapore time in electronic trading on the New York Mercantile Exchange. Crude had jumped to an 18-month high above $87 a barrel earlier this month.

Analysts say there is still a lot of uncertainty about how long the problem will persist and how much the overall economy will be affected.

But Rossi says a prolonged problem over the summer months "could snuff out the economic recovery in Europe."

"We were expecting 1-2 percent growth in the European economies during the coming year," Rossi adds. "But with this kind of prospect of the problems within the airline, travel, and tourism industries, then we could see zero growth during this period. That would be quite devastating after suffering already a very bad recession last year."

On the diplomatic front, Pakistani Prime Minister Yusaf Raza Gilani became the latest leader to abandon a visit to Europe. He was supposed to begin a trip to Paris, Brussels, and Madrid today.

And a joint mission of European Union officials and International Monetary Fund (IMF) to Greece has been delayed until April 21 due to the paralyzed flight traffic. Cash-strained Greece has requested talks with the EU, the European Central Bank, and the IMF over details and policies that could form a basis for loans agreed upon by eurozone states.

Some sectors, though, appear to be reaping the benefits of the disruption. Unable to catch flights, commuters across Northern Europe have sought other means of transport, to the benefit of railways, bus, and ferry companies.

With northern French airports closed until at least the morning of April 20, Eurostar trains between Paris and London were booked up until April 22.

Many U.S. and Asian airline flights to and from Europe were also canceled, and reports say hotels from Beijing to Singapore are straining to accommodate stranded passengers.