AIRPORTS:MINISTER FOR Transport Noel Dempsey said yesterday he was confident that Dublin airport's new Terminal 2 facility would not become a "white elephant" as a result of the €10 departure tax, which has sparked industry concerns that demand for air travel will decline sharply.
"We don't think it will be a white elephant but it might not fill up as quickly into the future," he said. He added that he was sure the Dublin Airport Authority (DAA) would act "prudently" in planning the facility.
His comments followed a statement yesterday by the DAA, which said it was reviewing its investment plans. The DAA is in the middle of a €2 billion redevelopment at Dublin airport.
"DAA is carrying out a detailed analysis of the impact of the current economic environment on passenger traffic through its airports and how this might affect the delivery timeframe for some planned infrastructure," it said.
"It is too early to predict what impact the Government tax may have on overall traffic volumes."
T2 was sanctioned by the Government, although it is not directly funded by the exchequer. It will cater for 35 million passengers.
Dublin airport is expected to handle 24 million passengers this year. This would represent growth of 3 per cent on 2007, but would be sharply down on the 10 per cent increase in passengers last year.
Ireland's regional airports, meanwhile, are to receive €11 million in capital grants in 2009, compared with €24 million this year.