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. Last Updated: 07/27/2016

Lufthansa in Talks Over Hub in Siberia

Russian authorities temporarily lifted a ban on overflights by Lufthansa Cargo after German officials agreed to hold talks on moving the airline's central Asian transit hub from Kazakhstan to the Siberian city of Krasnoyarsk.

The ban, imposed last week, looked set to escalate into a full-blown diplomatic spat between the countries amid fears that Russian officials were using strong-arm tactics reminiscent of those employed in the country's meat dispute with Poland.

Russian transportation authorities on Friday suspended the ban until Nov. 15, but Lufthansa officials insisted that the Siberian airport was currently unsuitable for its operations and that the issues of overflights and the use of Krasnoyarsk should not be linked.

"At the moment Krasnoyarsk is not ready to act as a cargo hub," Aage Dünhaupt, Lufthansa's director of corporate communications for Europe, said by telephone from London on Monday. "It would take more than a year and could always take longer."

"We are surprised that the overflight rights are linked to the use of a specific airport as a hub," Dünhaupt said. "For us they are two separate topics."

From midnight on Oct 28, Russian authorities unexpectedly withdrew Lufthansa Cargo's rights to use Russian airspace, disrupting the company's flights to Southeast Asia.

In a retaliatory move, German authorities on Oct. 29 briefly barred Aeroflot cargo flights to Frankfurt but lifted the ban the next day.

Lufthansa Cargo currently uses the Kazakh capital, Astana, as its refueling point for planes flying to Southeast Asia.

The dispute also comes against a wider background of trade spats between Russia and a number of EU countries, including a ban on Polish meat imports, imposed two years ago.

Calls have been made for Germany to take the matter to the European Union in an attempt to increase the pressure on Moscow.

Dünhaupt said Monday that the company was asking German officials "to use every possible means to find a solution to this problem."

If no agreement is reached on overflights, Dünhaupt said, Lufthansa and ultimately Germany's business community would begin to suffer.

Avoiding Russian airspace adds hours to flight times and ramps up fuel bills, Dünhaupt said. If the company were forced to change its routes permanently, then flights could be cut, he said.

"This would harm the German export business," he said.

Moscow has said the overflight ban against Lufthansa Cargo is because of the expiry of a previous agreement, while German officials and Lufthansa representatives have expressed surprise and anger with the Russian tactics.

The lifting of the ban Friday appeared to indicate that the two sides could reach a compromise, but Dünhaupt said the company still wanted to keep using Astana as its transit hub.

Germany is hoping to settle the dispute by working out a time frame for Lufthansa moving to Krasnoyarsk, German Transportation Minister Wolfgang Tiefensee said in a statement posted on the ministry's web site. But first, the Krasnoyarsk airport needed to be upgraded to cope with poor weather conditions, he said.

"We are confident that in the long term we will reach a good solution for both the German and the Russian sides," Tiefensee said.

In a similar statement, the Transportation Ministry welcomed German moves to resolve the dispute but defended its decision on the overflight ban. Russia expects a response from the German side by Wednesday, the ministry said.

The ministry said overflight rights to Astana had been granted to Lufthansa Cargo only under a temporary agreement. The latest agreement expired Oct. 27. The statement claimed that Lufthansa in February committed itself to move its transit hub to either Krasnoyarsk or Novosibirsk.

Some German politicians have lambasted Russia for its heavy-handed tactics and even linked the dispute to the country's accession to the WTO.

"Whoever uses such instruments in trade and economic policy is not suitable for WTO accession in the short term or the midterm," Christian Democrat lawmaker Gunther Krichbaum said in televised comments Saturday.

Krichbaum , who heads the German parliament's European affairs committee, compared the Lufthansa dispute with the Russia-Poland spat over meat imports. The moves were part of the "same pattern," he said.

Direct cargo flights to Russia and passenger services were not disrupted by the overflight ban, Dünhaupt said. Lufthansa is the biggest international passenger carrier flying to Russia.

Lufthansa only recently signed a two-year deal with the Astana airport, German media have reported. Astana airport spokespeople could not be reached Monday for comment.

Staff Writer Nikolaus von Twickel contributed to this report.