POLICIES AND CAPABILITIES OF POLISH CIVIL AVIATION

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79R01141A001400090002-4
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 40
• Document Creation Date: December 23, 2016
• Document Release Date: August 19, 2013
• Sequence Number: 2
• Publication Date: June 1, 1959
• Content Type: REPORT

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SECRET
ECONOMIC INTELLIGENCE REPORT
POLICIES AND CAPABILITIES
OF POLISH CIVIL AVIATION
CIA/RR 59-21
June 1959
N? 65
CENTRAL INTELLIGENCE AGENCY
OFFICE OF RESEARCH AND REPORTS
SECRET
i)
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WARNING
? This material contains information affecting
the National Defense of the United States
within the meaning of the espionage laws,
Title 18, USC, Secs. 793 and 794, the trans-
mission or revelation of which in any manner
to an unauthorized person is prohibited by law.
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ECONOMIC INTELLIGENCE REPORT
POLICIES AND CAPABILITIES OF POLISH CIVIL AVIATION
CIA/RR 59-21
CENTRAL INTELLIGENCE AGENCY
OffiCe of Research and Reports
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I
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FOREWORD'
In civil aviation, as in other economic activities) the Sino-
Soviet Bloc is increasing its competition with the Free World. The
growing interest of Communist leaders in penetrating the airspace
of the Free World, together with the recent development of new, high-
performance transport aircraft in the USSR, has spurred the need for
a more intensive study of developments in civil aviation in the Sino-
Soviet Bloc.
It is important, therefore) to evaluate the imminent expansion of
the civil air networks of the Sino-Soviet Bloc in relation to those
of the Free World and the effect of such expansion on the position of
the US as a leader in world aviation. Poland has been chosen as the
second of the European Satellites to be studied because, like Czecho-
slovakia, it occupies a pivotal position in civil aviation both with-
in the Bloc and between the Bloc and the Free World. Poland) however)
lacks both the advantages of Czechoslovakia in geographic position as
an important exchange point and the potential of the Czechoslovak
State Airlines for competition with the Free World.
This report has been coordinated within CIA bUt not with the other
agencies of the US Intelligence Board.
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Page
A. Agreements Registered With ICAO
18
B. Agreements Within the Sino-Soviet Bloc
19
1. USSR
19
2. European Satellites
19
3. Communist China
20
C. Agreements Outside the Sino-Soviet Bloc
20
I. Europe
20
2. Middle East ?
21
D. Relations with'Intetnational Organizations
21
1. ' ICAO
21
2. IATA
22
IV. Competitive Capabilities
22
Appendixes
Appendix A. Chronology of Principal Events Affecting the
Development of Civil Aviation in Poland . . . .
25
Appendix B. Relations of Poland with the International Civil
Aviation Organization (ICAO)
27
Appendix C.' Methodology.
29
Tables
1; Performande of'Fblish Airlines (LOT), 1947 and 1949-58 . 13
2. Estimated Operating Expenses of the Domestic Polish
Airlines, 1953-57 ?
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CONTENTS
Summary
I. Developments in Civil, Aviation
Page
1
3
A. Before 1954
3
1. General
3
2. Effects of the Communist Regime .
3
3. Effects of Change in Civil Air Policy of the
upsR
4
?
B. Changes in 1955-58
4
1. Coordination of European Satellite Operations
4
2. Expansion Beyond. Airspace of the Bloc ? ?
?
?
6 .
11.
Civil Air System
6
A. Organization
6
B. Routes
7
1. Domestic
7
2. International
8
C. Air Facilities
D. Inventory of Aircraft
9
E. Trends in Performance and Services
10
F. Finances
12
1. General
12
2. Investment
14
G. Evaluation of Efficiency-
16
1. Operations ?16
2. Personnel
17
III.
Civil Air Policies . . .......... ? . . . .
.
,
18
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Illustrations
Following Page
Figure 1. .L.and: Organization of Civil Aviation
(Chart)
Figure 2- Poland: .Domestic Air Routes of LOT,
1957.58 (Map) 8
Figure 3. Poland: International Air Routes of LOT,
1957-58 (Map) 8
Figure 4. icbland: Domestic Air Route's of LOT, '
February 1959 (Map) . . . . :
Figure 5. Poland: International Air Routes of LOT,
February 1959 (Map) 8
?
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POLICIES AND CAPABILITIES OF POLISH CIVIL AVIATION*
Summary
In the field of civil aviation, Poland ranks second in importance
only to Czechoslovakia among the European Satellites. Polish Airlines
(Polskie Linie Lotnicze -- LOT), however, is a small operation not com-
parable in performance with even a local service carrier in the US.**
Like Czechoslovakia, Poland occupies a favored position within the
Sino-Soviet Bloc, having priority in receiving new types of aircraft
from the USSR and occupying a pivotal position in civil aviation both
within the Bloc and between the Bloc and the Free World. Poland
became a member of the International Civil Aviation Organization (ICAO)
when it was formed and LOT is a long-standing member of the Interna-
tional Air Transport Association (IATA). As a member of ICAO and IATA,
LOT shares routes with Western European airlines and is faced with the
necessity of meeting the economic competition of the West. On the
other hand the position of LOT in the coordinated air network of the
Bloc is circumscribed by joint action taken at the spring and fall
meetings of the Satellite airlines to coordinate schedules within the
Bloc.
Up to 1958 the US-UK Satellite Air Policy and the restrictions
Imposed by COCOM had denied Western aircraft to the Sino-Soviet Bloc,
and the standard aircraft built by the USSR for airlines of the Bloc
were not suited to long international flights. In 1957, however,
with the sanction of COCOM, LOT acquired 3 second-hand Cohvair 240
aircraft built in the US. With this equipment and Soviet I1-14's,***
LOT instituted flights to London and Athens. Recently, officials of
LOT have mentioned the possibility of buying Viscount turboprop trans-
ports or Comet 4-engine jets from the UK, Lockheed Electras from the
US, or 11-18' s** from the USSR. Lack of foreign exchange and the '
fear that the flow of spare parts for Western aircraft might be
stopped may inhibit such purchases from the West. On the other hand,
* The estimates and conclusions contained in this report represent
the best judgment of this Office as of 15 April 1959.
** Allegheny Airlines, with 22 aircraft of the DC-3 type, transported
450,000 passengers in 1957, whereas the peak for LOT in 1957 was
224,300.
*** The '1-14 is a reciprocating twin-engine transport with a ca-
pacity of 21 to 26 passengers.
**** The I1-18 (Moskva) is a 4-engine turboprop transport with a
capacity of 75 to 100 passengers.
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rumors of unsuccessful flight tests of the 11-18 may discourage Pblish
acquisition of the transport from the USSR. Naturally the Poles are
hesitant about making the extensive financial commitments necessitated
by modern, high-performance aircraft, without being sure of performance
and traffic potential. Unless modern aircraft are acquired, however,
LOT will be unable to compete effectively on the international routes
now scheduled and will find itself restricted to short hauls and char-
tering operations where the price of transportation outweighs con-
siderations of speed and comfort.
The domestic flights of LOT, which average only 260 kilometers
(162 statute miles) in length, are too short to be economical and have
shown large deficits for several years. In 1956 the Parliamentary
Committee for Transportation took steps to "modernize" air transport.
In addition to extending international routes, the committee undertook
to make domestic services profitable. The tariff in effect from 1954
to 1957, which was based on first-class railroad fares, attained a
high load factor but brought in only 49 percent of expenditures. In
November 1957 the fares were increased by about 130 percent, and the
result was a reduction of more than 70 percent in the number of pas-
sengers carried; and the abandonment of some routes followed. On
1 February 1958 the fares were lowered to about 60 percent above those
in effect before November 1957. The load factor has not been reported
since that time, but a Polish writer concludes that no tariff measures
could assure the profitability of domestic air transport in Poland,
and it is assumed that the line is still operating at a loss.
Since 1945, LOT has suffered from a conflict in operational pro-
cedures, and its efficiency has been impaired by the heterogeneous
character of the aircraft received from the USSR and the West. The
Five Year Plan (1956-60) envisaged an increase of 50 percent in the
ton-kilometer volume of air transport, dependent largely on the de-
velopment of international routes. Indications are that hesitation
in acquiring new types of aircraft has prevented LOT from registering
Increases in ton-kilometer performance. The ultimate accomplishment of
the 5-year objective will necessitate not only the introduction of
modern aircraft on the international routes of LOT but also the im-
provement of the Warsaw airport to afford safety to airlines flying
into Poland under reciprocal air agreements.
LOT, in short; has little potential for competition in world
civil aviation, and its initiative is hampered further by the limita-
tions of Polish foreign exchange and by the close coordination of the
air operations of the Sino-Soviet Bloc.
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I. Developments in Civil Aviation.
A. Before 1954.
1. General.
The development of civil aviation in Poland has paralleled
political changes in the government. The Polish Airlines (LOT), which
discontinued operations in 1939 under the Nazi occupation, resumed its
activities in 1945. Immediately after World War II the USSR began to
influence developments in civil aviation by exerting pressure on LOT
to-purchase Soviet aircraft and to employ Soviet advisers on detail.
At the same time) the Poles were acquiring Western aircraft such as
the DC-3 and the French Languedoc transport. In April 1945 the Pblish
government-in-exile had become a member of the International Civil
Aviation Organization (ICAO). LOT subsequently became a member of the
International Air Transport Association (IATA). The cooperative rela-
tionship between LOT and airlines of the West balanced Soviet influ-
ences, and the Polish inventory of aircraft was divided about equally
between Soviet and Western aircraft.
2. Effects of the Communist Regime.
From October 1947, when the Communists came into complete
control of Poland, to 1954 the aviation policy of Poland was one of
collaboration with the airlines of the Sino-Soviet Bloc and partial
isolation from the West. Two factors influenced developments in civil
aviation in the Bloc during this period: (a) the increasing coordina-
tion of air services throughout the Bloc and (b) the US-UK Satellite
Aviation Policy, which was to deny air equipment from Western sources
to the Bloc and to restrict the airlines of the Bloc to their own air-
space.
In 1949 the USSR allotted Poland the I1-12,* and since
1950 economic collaboration with other members of the Soviet Bloc has
fostered the close coordination of air networks and the standardiza-
tion of equipment and operational procedures. At the end of 1950,
LOT was serving the European Satellite capitals of Berlin (Schoene-
feld), Budapest, Bucharest, and Prague. It also had routes to the
West, including scheduled flights from Warsaw to Brussels, Paris) and
Stockholm. During 1951-54, LOT retained its routes to the West and
extended its services within the Bloc. A route to Sofia was added, '
and in 1951 the first coordinated program for scheduling of Bloc air-
lines was adopted.
* A reciprocating, 2-engine transport designed in 1947 as a replace-
ment for the DC-3 but carrying only 18 passengers.
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3. Effects of Change in Civil Air Policy of the USSR.
Until late 1954 the USSR had excluded from its airspace
all foreign airlines, including the various East European carriers in
which the USSR shared ownership. Although LOT did not fall within the
latter category, the operations of Fblish civil aviation were circum-
scribed both by their dependence on the USSR for aircraft and auxil-
iary equipment and by the close coordination of routes within the Sino-
Soviet Bloc. Then, in a reversal of policy; the USSR Withdrew from
ownership in joint airlines; concluded reciprocal air agreements with
the European Satellites, Communist China, and North Korea; and awarded
routes to Moscow not only to the Satellites but also to the airlines of
Finland and the Scandinavian countries.
The changes in Soviet policy also resulted in an exchange
of rights among the European Satellites and in the allotment to the
Satellites of Soviet aircraft of the same type as that used by the
Soviet carrier, Aeroflot.* Boland; like Czechoslovakia; received the
new Soviet 11-14 to fly the route to Moscow shared with Aeroflot.
B. Changes in 1955-58.
1. Coordination of European Satellite Operations.
Beginning in 1955 the operations of LOT were coordinated
more closely with those of Other European Satellites. The other air-
lines represented in the coordinated program for civil aviation are
Deutsche Lufthansa; East Germany; the Czechoslovak State Airlines
(Ceskoslovenske Statni Aerolinie CSA); the Hungarian airline (Mag-
yar Legikozlekedesi Vallalat MALEY); the Bulgarian carrier (Ttans-
portno Aviatsionnoye Bolgaro-Sovetskoye Obshchestvo TABSO)**; and
the Rumanian carrier (Transporturi Aerienne Fbmine TAROM). The
first step in coordination was to arrange for the airline of each
country to make a circuit Of several major cities, instead of single-
stop round trips, in order to economize on aircraft and gasoline.
Since the inception of the program, representatives of
the European Satellite airlines have met twice a year with officials
of Aeroflot. These spring and fall meetings apparently have resulted
* Aeroflot is the trade name of the Soviet Civil Air Fleet (Grazhdan-
skiy Vozdushnyy Flot GVF).
** The airline retains the name indicating joint ownership by the
USSR and Bulgaria, even though the USSR withdrew from the company in
1954.
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In the approval of summer and winter schedules for the group, as well
as in the improvement of procedures that would bring the airlines of
the Bloc more nearly into accord with standards which have been ap-
proved by ICAO and are used outside the Bloc.
In September 1957, representatives of the six European
Satellite airlines, at a meeting attended by a representative of
Aeroflot as an observer, concluded an agreement for technical-scien-
tific collaboration. .2.1 The provisions of the agreement are not
available but reportedly were based on a study of the commercial,
financial, and technical activities of the six airlines during the
first half of 1957. Early in 1958, detailed measures were adopted to
cover the development of routes, interline traffic, and advertising, V
moves obviously designed to foster the general drive by the airlines
of the Sino-Soviet Bloc to penetrate the airspace of the Free World.
A pooling arrangement adopted at the same conference led to the estab-
lishment of a coordinated airline network analogous to the European
Consortium proposed by Italy to the Council of Europe in 1951.
It has been the custom of European airlines to share a
route by giving each carrier an equal number of flights. For example,
Poland and Czechoslovakia traditionally have flown the route to Zurich
as follows: LOT shared the segment Warsaw to Prague with CSA, and
Swissair flew the Prague to Zurich section with a frequency which per-
mitted connections with both CSA and LOT. With the advent of jet
aircraft, however, certain airlines in Europe and the US have worked
out programs for pooling of aircraft. One of the recent agreements is
that concluded between Swissair and SAS (Scandinavian Airlines System)
by which SAS will lease from Swissair 2 of the 5 Convair 880 jet
aircraft to be delivered in 1960. SAS, in turn, will lease to Swissair
4 of the 16 Caravelles now on order. All Caravelles are to be serviced
in Scandinavian shops and all Convairs in Switzerland, thus reducing
costs of maintenance. European carriers also have resorted to joint
financing, the maintenance of stocks of spare parts, the pooling of
revenues for certain routes, and the joint operation of sales offices. V
In July 1958, at a conference on civil aviation held in
Dresden on the initiative of the USSR, each of the European Satellite
airlines was assigned a role in keeping with capabilities of the parent
country. Rumania and Bulgaria, which had the lowest capabilities for
the development of civil aviation, were said to be limited to repair
work. ?/ In August 1958, at a meeting held in Budapest, the group
attempted to extend operations outside the Bloc by including Austria
as a participant in a southeast European air pool. I/
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2. Expansion Beyond Airspace of the -Bloc.
The reversal of Soviet policy in 1954 included not only
the liberalization of entry into Soviet airspace by the European Satel-
lite and Western carriers but also launched a vigorous campaign to
extend the routes flown by Communist airlines into Western Europe and
the Middle East.
Early in 1956, Poland began to implement bilateral agree-
ments which resulted in the establishment of routes to Yugoslavia,
Austria, Denmark, the UK, and Greece. The international route-kilo-
meters flown increased from 7,731 kilometers (km) in 1956 to 8,070
in 1957 and to 10,407 in 1958. ?/
This expansion was accompanied by advertising,* hitherto
stigmatized by Communist propaganda as a capitalist weapon. Revised
rates of foreign exchange were offered prospective travellers to en-
dourage a greater flow of visitors. A tourist rate of 24 zlotys to.
US $1 was offered in Poland compared with the official rate of 4 zlo-
tys to US $1. The acquisition of foreign exchange was a major objec-
-tive in expanding the operations of the airlines of the Sino-Soviet
Bloc into Western airspace, although the manager of LOT claims to
have made a small profit also in international operations during
1957. 2/
II. Civil Air System.
A. Organization.**
LOT is a state enterprise which is subordinate to a directo-
rate of civil aviation under the Ministry of Transportation, and its
organizational structure has been changed frequently. .From 1945 to
June 1949 the civil airlines were combined with other forms of
transport under the Ministry of Transportation, 12/ In June 1949
the Central Directorate for Civil Aviation was established under the
Ministry of Transportation. 11/ In February 1951 the Ministry of
Transportation was split into the Ministry of Railroads and the
Ministry of Highway and Air Transport. 12/ The latter ministry was
placed in control of (1) construction, maintenance, and operation.of
all public roads and airfields and (2) the isSuance of regulations
with regard to road and air traffic. 11/ In March 1957 the Council
* Aeroflot set the example by advertisements in the New York press.
** For a chart showing the organization of Polish civil aviation,
see Figure 1, following p. 6.
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Poland: Organization of Civil Aviation
Parliamentary
Committee for
Transportation
COUNCIL OF MINISTERS
Ministry of Transportation
Directorate of Civil Aviation
Director General: A. Skala
L PZ *
LOT **
Figure 1 50X1
Scheduled
Air Services
Aero Clubs
Special
Services
Agriculture
Ambulance
Forestry
Director of
Operations
?I Water Purification
Operations
Divisions
Freight
Division
Training
Airport
Guard Services
Fire Services
27804 5-59
Ground
Flight Crew
Air Traffic
Communications
Installations
Division
Management
Radio Navigation
*Liga Przyjaciol Zolnierza?League of the Friends of the Soldier (LPZ)
"Polskie Linie Lotnicze?Polish Airline
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of Ministers again merged all forms of transport in order to reduce
the number of persons employed and to coordinate plans for invest-
ment.ill/ This reorganization was accompanied by a policy adopted
by the Parliamentary Committee for Transportation, which took steps
to modernize air transport. The program for modernizing LOT has
emphasized international routes and concomitant needs stemming from
the expansion of service outside the Bloc. Among the principal
requirements for such expansion the Committee cited the need for new
aircraft suited to long-distance routes and the revision of account-
ing and planning so as to improve operational efficiency and thus
permit competition with foreign airlines. 12/
In addition to its control of LOT, the Directorate of Civil
Aviation has the following responsibilities (1) the supervision
of Aero clubs,* (2) the maintenance of liaison with other government
agencies, (3) the issuance of air crew licenses, ()'the signing of
official aviation contracts, and (5) the representation of Poland in
ICAO. Like other Communist airlines, LOT has a dual role -- the
operation of a commercial scheduled air carrier and the performance
of special services to agriculture, public health, forestrY, and
water purification.
B. Routes.
1.. Domestic.**
POland offers frequent service on domestic flights from
Warsaw to Gdansk/Gdynia, Krakow, Lodz, Poznan, Rzeszow, Szczecin,
and Wroclaw. 12/ The number of flights ranges from 1 to 4 daily,
and the density of the air route network is 0.57 km per 100 square
kilometers. The total length of the unduplicated domestic network
was 1,770 km in 1958..1._Q/
In 1956 the passenger load factor ranged from 80 to
90 percent, being highest on the routes from Warsaw to Krakow and
Warsaw to Gdansk and lowest on routes from Warsaw to Rzeszow and
Warsaw to Bydgoszcz. 12/ As a whole, however, these domestic opera-
tions lost money at a time when passenger load factors of 60 percent
* League of the Friends
LPZ).
** For a map showing the
Figure 2, following p. 8.
February 1959, see Figure
of the Soldier (Liga Przyjaciol Zolnierza
domestic routes of LOT in 1957-58, see
For a map showing such routes as of
4, following p. 8.
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in the US were yielding a profit. A change in policy in 1957 raised
the domestic fares in an effort to reduce losses and reduced-or
eliminated service to certain cities which might be reached just.as
conveniently by railroad.*
2. Internationl.*4
The international flights of LOT serve Moscow and the
capitals of all the European Satellites as well as Athens, Belgrade,
Brussels, Copenhagen, London, Paris, and Vienna. In 1958 the un-
duplicated route-kilometers on the international network amounted to
10,407 km. 22/ Czechoslovakia, with an international network of
18,422 km, is the only European Satellite exceeding the international
network of LOT. Whereas the international routes of LOT accounted -
for 76 percent of the length of the total network in 1955 and 1956
and 77 percent in 1957, schedules for 1958 reveal a slight increase
to 85.5 percent.
There are indications-that Poland may seek to extend its
route to Athens to the Far East and ultimately- to Communist China.
Also envisaged is a Polish route to Rome, with an eventual extension
to the Near East and Africa. 21/ Moreover, Polish membership in
ICAO and the long-standing membership of LOT in IATA will tend to
assist Poland in efforts to expand its international routes. Re-
strictions imposed by COCOM, which had denied Western aircraft to
the Sino-Soviet Bloc, were revised in 1958. These revisions will
permit LOT to acquire aircraft designed for longer flights.
C. Air Facilities.
A survey of air facilities is essential to an appraisal of
the capabilities for civil aviation of any country. Modern aircraft
necessitate new standards for length, for type of surface, and for
weight-bearing capacity of runways. Poland has 102 airfields, of
which 42 have hard-surfaced runways of 6,000 feet or more, thus
qualifying as major airfields. 22/ Eleven of the airfields have
runways of at least 8,200 feet, the minimum length for servicing
jet aircraft. 2V At Okecie, the civil airfield at Warsaw, the
longest runway is 6,560 feet. To enter the jet age as a serious
* See E, p. 10, below.
** For a map showing the international routes of LOT in 1957.-58,
see Figure 3, following p. 8. For a map.showing such routes as
of February 1959, see Figure 5, following p. 8.
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1957 1958
BALTIC SEA
Gdo6sk/GdynIa
Szczecin
tir,4
EAST
GERMANY
1/4
66
Bydgosza
12
Poznan
Krok?w ? Rzatio
CZECHOSLOVAKIA
Figure 2. Poland: Domestic Air Routes of LOT, 1957-58.
.
Figures indicate number of reasnd-top 1' flights per week.
c 1957 1958
Stockholm
BALTIC
41 r,Hi
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competitor, however, Poland will be forced to make considerable im-
provement in its facilities, both in the construction of runways and
In ancillary equipment.
The Poles recently received civil aviation communications
equipment from Western sources* for Okecie, so that the European air-
lines making use of Okecie under reciprocal air agreements may operate
safely under ICAO standards. Plans for the further improvement of
runways at Okecie and at other civil airfields have been announced,
but apparently their implementation depends on a solution of the
financial difficulties of LOT.
D. Inventory of Aircraft.
As of October 1958 the inventory of aircraft of LOT consisted
of 13 I1-14's, 4 Il-12's, 2 Convair 240's,** 30 DC-3's and L1-2's*** 22/
but no 4-engine aircraft. Like other airlines of the Sino-Soviet
Bloc) however, LOT is in a period of transition as far as aircraft are
concerned. The L1-2's and DC-3's which are used for domestic flights
are being replaced by I1-14's. Poland contemplates having the older
I1-14's accommodating 21 passengers converted to aircraft carrying
26 passengers, like those produced in East Germany, or 32 passengers,
like those produced in Czechoslovakia.
Poland will require modern, high-performance transport for in-
ternational flights in order to meet competition. In October 1957 LOT
bought three Convair 240 aircraft second-hand from Sabena (Societe
Anonyme Beige d'Exploitation de la Navigation Aerienne), Belgian Air-
lines. The aircraft were overhauled completely, but 1 was wrecked on
a training flight soon after its acquisition and the remaining 2
aircraft are quite inadequate to service the international routes of
LOT. Poland now ranks second to Czechoslovakia among the European
Satellites in equipment, the Czechoslovak airline CSA having acquired
three Tu-104'sxxxx in December 1957. The Poles long have desired to
buy new transport aircraft but have been inhibited from buying from
the West by lack of foreign exchange and by COCOM regulations which
denied aircraft to the Bloc. With the recent easing of these regula-
tions, the Poles are exploring the possibility of acquiring Western
* Some of the other Satellites, including Hungary and Czechoslo-
vakia, also have received air-ground communications equipment from the
West.
** The Convair 240 is a US reciprocating 2-engine transport accom-
modating 40 passengers.
xxx The Li-2 is a Soviet version of the DC-3.
xxxx The Tu-104 is a Soviet 2-engine jet transport accommodating
70 passengers.
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aircraft. ay LOT is interested in pur- 50X1
chasing three Lockheed "Electra" transport aircraft. The price of
the three aircraft with spare parts would be approximately US $10
million.* Plans to make the purchase under credits from the US or
through an arrangement with the Israeli airline El Al are being
considered by officials of LOT. 22/ After the UK had rescinded the
ban on the export of .civil aircraft in August 1958 and after Polish
officials had seen a demonstration of the Viscount in Warsaw, it was
reported that a possible order for six Viscount 810's for LOT was
contemplated./ In addition, the Poles had demonstrations of the
British Comet- and the Soviet I1-18. Some of the airline offi-
cials declared their preference for Western types) but the Polish
press in November 1958 stated: "We will probably buy a turbo-prop
Moskva (1-47 airliner from the USSR. It is a 4-eng1ne plane with a
cruising speed of' 500 km per heur and a pressurized cabin for 100
passengers." !9/ The Technical Director of LOT expressed particu-
lar interest in the purchase of six I1-18's.
In the competition between East and West, Poland will prob-
ably avail itself of the most advantageous offer of new aircraft
on the basis of both political and economic considerations. -
E. Trends in Performance and Serviees.
Under the tariff in effect from 1954 to November 1957,
which was based on first-class railroad fares, the domestic routes
of LOT operated under satisfactory load factors but were finan-
cially unprofitable. As previously noted) average load factors
were between 80 and 90 percent) a level which is unusupiiy high.
Income, however) amounted to only 49 percent of costs.
' In the face of this situation, an increase in fares ob-
viously was necessary to attain profitability. The tariff put into
effect on 15 November 1957 increased fares by about 130 percent to
the level of railroad Pullman fares. The effect of this increase
was to reduce the number of passengers carried on some routes to
such an extent as to warrant their abandonment. Katowice) for
example) which was formerly served by 12 flights a week from Warsaw
and 6 flights from Lodz, was removed from the domestic schedule.
The airfield at Katowice was undermined by coal mining operations,
but no other airfield was substituted) and the area was denied air
service. Bydgoszcz had had three round trip flights per day to
* Dollar values are given in current US dollars throughout this
report.
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Figures indicate number of round-trip flights per week.
Figure 4. Poland: Domestic Air Routes of LOT, February 1959.
Figures indicate number of roaa:trip flights per week.
Stockholm
NORTH
ck?
/ SEA
DEN
Cepen
VIPs-sees
()
,KINGDO
tondo
CZECH
RANCE
Belgrade
Y GOSLAV
BLACK
SEA
MED! TERRA NEA N SEA
10
TUktKEY
30
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other cities in Poland in 1954 but no longer appeared on the schedule
In 1958. Henceforth) travelers were to utilize rail and highway
transport which) for shorter distances, was presumed to be adequate
and thus to render airline service unnecessary.
The combined effect of the higher fares and subsequent aban-
donment of some flights was to reduce the number of passengers
carried by more than 70 percent. In spite of the loss of traffic,
the airline was able to reduce its costs to such an extent that the
actual deficit was reduced. Revenues still met only 50 percent of
the costs.
On 1 February 1958 a new seasonal tariff reduced the fares
to about 60 percent above those existing before November 1957, but
the number of flights was not increased. The results of this tariff
have not been publicized, but a Polish author) in discussing the
manipulation of tariffs and the effect on the domestic operations of
LOT, concluded that no schedule of tariffs could assure the profit-
ability of domestic air transport in Poland. Li The average length
of air route, 260 km (162 statute miles), was too short for economic
exploitation, and the high fixed costs of airline operation were
spread over too few traffic units. L/
Recent and current trends in the international services of
LOT reflect the problems arising from the dual position of Poland as
a member of the Sino-Soviet Bloc, operating on a socialist pattern)
and as a competitor with airlines of the Western world. In its posi-
tion in the coordinated network of the Bloc LOT follows operational
procedures common to the Satellites and is circumscribe& by joint
action taken at the spring and fall meetings of the Satellite air-
lines. On the other hand, as a member of the international organiza-
tions ICAO and IATA, LOT shares routes with Western European airlines
and is faced with the necessity of meeting the economic competition
outside the Bloc. In 1956 the Parliamentary Committee for Transpor-
tation took steps to modernize air transport, 12/ the purpose of which
was to strengthen Polish civil aviation by expanding services outside
the Bloc. Such a program conformed with the policy of the Bloc, and
the Committee hoped that such expansion would earn readily convertible
foreign exchange.
The Director of LOT, A. Skala, predicted a decrease of 60,000
domestic passengers and an increase of 16,000 passengers on interna-
tional routes in 1958. The official figures for 1958, however, show
a far greater decline in domestic passengers and a much smaller in-
crease in passengers on international routes than had been pre-
dicted. L/ Evidently the implementation of the policy of the Parlia-
mentary Committee was delayed by radical developments in high-capacity,
long-range aircraft.
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Data reflecting the performance of LOT in 1947 and 1949-58
are shown in Table 1.* Except in the year 1953, there was a steady
increase in passengers. The decrease of 9)000 passengers and a
corresponding decrease in passenger-kilometers in 1953 paralleled
the low point in Czechoslovak civil air operations in the same year.
Air freight continued to register small increases throughout the
period. The average annual rate of growth in the number of passen-
gers carried during 1955-57 was 17.9 percent, compared with 14 per-
cent in the rest of the world. The average annual rate of growth
in passenger-kilometers during 1955-57 was 23.6 percent) compared
with 15.6 percent in the rest of the world. Because of the decrease
of 41.3 percent in passengers carried in 1958, however) the average
gain for the 5-year period 1954-58 was only 2.8 percent. No parallel
figure on the number of passenger-kilometers in 1958 is available,
but, because of the relative weight and continued increase of inter-
national travel) it is believed that the average annual increase in
passenger-kilometers during the 5-year period was about 14 percent.
F. finances.
1. General.
Poland has established no reliable accounting system by
which the state-owned enterprises can assess with reasonable accuracy
the real economic gains or losses of a particular operation. The
operating figures of LOT are not published. Estimates of the cost
structure of the domestic airlines have been made for the years
1953-57 on the basis of relevant published percentages, however, and
are shown in Table 2.** Revenue from domestic services in 1957 can
be estimated at 54.19 million zlotys and operating expenses, at
110.6 million zlotys.*** It should be noted, however, that revenue
frOm aviation services may substantially understate the actual value
of these serviceS to the economy. 12/
The international services of LOT are stressed in Polish
planning for the future, but it seems evident that modern, high-
performance aircraft will be needed to meet the type of competition
which is rapidly developing. A press report of October 1958 claimed
Table 1 follows on p. 13.
** Table 2 follows on p. 15.
*** The average operating cost per passenger-kilometer decreased
from 1.25 zlotys in 1955 to 1.23 zlotys in 1956. The Li-2, which
is comparable to Polish aircraft) is said to be operated by Aeroflot
at 3.41 rubles per ton-kilometer and 0.33 ruble per passenger-
kilometer.
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Table 1
Performance of Polish Airlines (LOT) 2/
1947 and 1949-58 ,
Measure of Etrformance
1947 -
1949
1950
1951
1952 '
1953
1954
.1955
1956 '
1957
1958
Passengers (number)
Domestic
55,800
59,900
N.A.
LA.
N.A.
N.A.
N.A.
141,800
168,200
183,600
89,900
International
4,000
4,600
N.A.
N.A.
N.A.
LA.
N.A.
17403
31,400
40,700
41,800
Total
59,800
64,500
89,000
113,200
123,500
114,700
136,700
159,200
199,6 00
225,300
131,700
Air freight (metric tons)
Domestic
400
500
N.A.
N.A.
N.A.
N.A.
N.A.
N.A.
N.A.
N.A.
, N.A.
International
230
hoo
N.A.
N.A.
N.A.
N.A.
N.A.
N.A.
LA.
LA.
N.A.
Total
630
900
980
1 6
S.0--0
1,270
1,960
2,580
2,750
3,330
3 8co
N.A.
Length of network (kilometers)
Domestic
2,035
2,430
N.A.
N.A.
N.A.
N.A.
M.A.
2,436
2,436
2,423
1,770
International
4,955
6,220
N.A.
N.A.
N.A.
N.A.
N.A.
7,848
7,731
8,crio
3.0,407 L3/
Total
6 992
?2
N.A.
N.A.
N.A.
N.A.
N.A.
10,284
10,167
10,493
12,177
Passenger-kilometers (Million)
_--
Domestic
15.3
16.9
N.A.
N.A.
LA.
N.A.
N.A.
48.7
57.6
N.A.
N.A.
International
3.1
4.9
N.A.
N.A.
N.A.
N.A.
N.A.
17.2
31.0
N.A.
Total
18.4
21.8
30.5
38.7
42.7
. 40.7
53.3
65.9
88.6
101.0
N A
Ton-kilometers (million)
Domestic
N.A.
0.14
N.A.
N.A.
N.A.
N.A.
0.6
0.67
o.6
0.3
International
0.47
N.A.
N.A.
N.A.
N.A.
N.A.
1.0
1.30
1.8
1.9
Total
N.A.
0.61
0.62
o.67
0.76
1.01
Itgl
1.6
1.97
. 2.5
a. 2i,/
b. Unduplicated mute-kilometers in 1958 are not given in the latest official figures; the total and domestic and international kilometers of unduplicated routes have
been calculated on the basis of changes Since 1957.
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a small profit (17.5 milhijn zlotys) for the international routes of
LOT in 1957. In 1958 the passengers on international flights
numbered 4)..,800, compared with 40,700 in 1957, but in the first half
of 1958 only 16,000 passengers were carried, a decline of more than
5,000 from the 21,250 carried in the first half of 1957. .3.13./ The
average passenger load factor in 1958 was 44.2 percent compared with
65.3 percent in 1957. 12/ Thus in the second half of 1958 there was
considerable improvement, the exact nature of which is not yet certain,
but which may have resulted from an increase in chartering services.
In chartering operations the type of equipment and time schedules are
secondary to pricing, and high passenger load factors generally can
be obtained. As a member of IATA, LOT must abide by the farea set by
the international body, so there is no possibility of adjusting fares
on regular flights to compensate for antiquated aircraft.
2e Investment.
No data are available on the amount of funds invested in
LOT or on the funds needed in the immediate future for modernization
and expansion. Some notion of the amount involved can be obtained,
however, by estimating the original cost of aircraft now held by LOT,
the cost of new aircraft, and the cost of improvement of airfields.
The original cost of aircraft now held by LOT, totaling $10,110,000, .
is estimated to have been as follows:
Aircraft
Cost
(us$)
Type
Number
Per Plane
Total
Li-2
30*
150,000
4,500,000112/
I1-12
4
180,000
720,000
11-14
13
330,000
4,290,000 41/
-2/
Convair 240
2**
300,000
600,000
Total 10 110,000
In 1958, COCOM approved the sale to Poland by the UK of
6 to 8 Viscount aircraft valued at about $8 million, an amount
close to the original cost of the aircraft now held by Pbland. This
sale has not been made as yet, inasmuch as LOT apparently has not
made a final decision on what type of modern aircraft to buy for its
international routes. lia/
This number is high because it includes the old C-47/DC-3 air-
craft which are probably in process of being scrapped.
** Second-hand.
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Table 2
Estimated Operating Expenses of the Domestic Polish Airlines 21
1953-57
Million Current Zlotys
Expense
1953
1954 ,
1955
1956
1957
Materials
Fuel
13.2
14.0
14.4
16.8
26.3
Other
12.4
13.1
13.5
15.7
24.4
Subtotal
25.6
27.1
27.9
32.5
50.7
Wages
20.0 12/
21.2 y
21.8 sj
25.4 a/
39.6 Ey
Amortization
6.5
6.9
7.1
8.2
12.8
Other expenses
3.8
4.0
4.1
4.8
7.5
- Total
55.9
59.2
60.9
70.9
110.6
Index (1953 = 100) 100 . 106 109 127 198
a. The percentage distribution of operating expenses was derived from source /. For
methodology, see Appendix C.
b. 45
11%
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To bring Okecie Airfield up to international standards for
jet aircraft would require lengthening of the runway, increasing its
weight-bearing capacity (which is now said to be marginal), and in-
stalling communications equipment such as ILS,* air-to-ground, VHF)**
and surveillance radar.
In order to bring the longest runway at Okecie up to
standards for the international operations of the Boeing 707 or the
DC-8, it is estimated the length should be 9)650 feet, 3,090 feet
longer than the present 6,560 feet.12f/ The cost of constructing the
longer runway with a depth of concrete of 16 inches would be 73.7 mil-
lion 1957 zlotys.
Instead of attempting to strengthen the present runway at
Okecie, officials of LOT might decide to build a new runway suitable
for jet aircraft. It is estimated that the cost of a new runway of
the minimum length of 8,200 feet by 200 feet, with parallel taxiway
and four connections 75 feet wide, made of 12-inch thick concrete over
12-inch sand or gravel over compacted subsoil, would be 46.6 million
1957 zlotys.
Communications equipment for use at Okecie recently has
been approved for installation. The sale to Poland of 2 complete sets
of ILS equipment with a total value of $224,680 and up to 8 sets of
airborne equipment valued at $18,000 were approved recently by
COCOM. '
It is extremely difficult to assign a dollar value to
costs for construction within Poland. If, for example, a conversion
ratio of 30 zlotys to US $1 were applied to the estimates made in
zlotys for the airfield runways, $1.6 million to $2.5 million would
be required for upgrading a single airfield to receive jet aircraft.
G. Evaluation of Efficiency.
1. . Operations.
Poland shares with Czechoslovakia the advantages gained
from membership in international organizations but is far less able
to make use of the technical and operational knowledge available.
The lack of standardization of equipment creates problems in operating
* Instrument landing system.
** Very high frequency.
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procedures) maintenance, and flight training, and also requires that
special supplies of fuel be set up at points outside Poland.* 22/
Another problem is the small capacity for passengers of
the present inventory of two-engine aircraft in Poland, which is too
limited to offer a payload which would be profitable. In the US)
rising costs have made unprofitable the operation of a DC-3, even
with 21 to 28 passengers) in competition with aircraft of greater
capacity. It is even more difficult for LOT, using the comparable
11-12 and 11-14) which have a maximum capacity of only 18 to 21 pas-
sengers, to operate at a profit.
LOT does not offer satisfactory standards of comfort,
reliability, or punctuality. Travellers report dirty seat-covers)
windows, curtains, and floor rugs. 21/ In one case, at least,
passengers were left stranded in a foreign country after having
paid for a round-trip ticket in Polish currency in Warsaw. 22/ A
sudden cancellation of unprofitable flights between Poland and
Israel caused unforeseen difficulties for tourists, Who had to
borrow foreign currency to buy new tickets on other airlines to
return to their homes in Poland.** Punctuality frequently has been
disregarded in the scheduled flights of LOT. 2V In September 1957
a passenger with a reservation to fly from Warsaw to Berlin waited
2 hours at the airfield and then learned the plane was not leaving
that day. The next morning the scheduled departure was delayed
again) allegedly because of bad weather. When the passenger finally
arrived in Berlin, he learned the flying weather had been good all
the while.
Buildings at airports are inadequate to handle the in-
creased number of domestic and international passengers. In Warsaw)
for example, a drab hut serves as a custom house, and passengers
are inconvenienced by long delays and waiting in line. 2i4/
2. Personnel.
The efficiency of flight personnel in Poland is hampered
by the customary procedure in a Communist state of putting political
reliability ahead of technical qualifications. As a result of the
crash ofra LOT aircraft in Moscow in June 1957) however, the Polish
Jibe Convair 240 requires 108/135 grade gasoline not available
in the Sino-Soviet Bloc. The problem does not exist within Poland)
however, because COCOM has granted permission for sales of gasoline
to LOT.
** These were charter flights taking Polish Jews to visit relatives
in Israel in 1958.
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administration indicated a disposition to change the emphasis in favor
of technical preparation. 22/ Polish pilots trained in the UK* are
now reaching the age limit for commercial flying) and the younger
pilots are restricted to Soviet types of aircraft.
When the three Convair 240 aircraft were acquired in Novem-
ber 1957, the training of personnel was a great problem for the Poles,
and putting the aircraft into service was a slow process. On 12 April
1958) 1 of the 3 aircraft crashed at Okecie Airport while the pilot
was undergoing checkout procedures on take-off, approach, and land-
ing. ly The lack of qualified maintenance personnel kept the Con-
vairs grounded in Warsaw in January 1958. Fuel tank leaks and brake
troubles were-beyond the capabilities of the personnel of LOT to
repair. 2//
III. Civil Air Policies.
As a result of its membership in ICAO and IATA, Poland has
attempted generally to base its policy in civil aviation On the in-
ternational Principles adopted by ICAO. On the other hand, since
1945 the Pales have received Soviet aircraft and technical assistance
for their civil airline. In 1947, when the Communists gained control
in Warsaw, Poland began to cooperate more closely With the USSR and
has become a favored participant in the closely coordinated air net-
work of the Sino-Soviet Bloc, ranking after Communist China and Czecho-
slovakia.
A. Agreements Registered with ICAO.
As of June 1958) Poland had two bilateral agreements of the
Chicago** type registered with ICAO) as follows 2V:
Country
Date Date
Signed _in Force
Czechoslovakia 24 January 1946 13 November 1947
Sweden 8 June 1956 " 8 June 1956
These agreements may have been registered With ICAO by the other
parties to the agreement. Poland's anomalous position in ICAO was
not clarified until May 1958) when the Communist government of Poland
* Polish pilots flew with the RAF in World War II.
** In general, a reciprocal agreement in harmony with the type sug-
gested by ICAO, usually granting a route from capital to capital.
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made arrangements for the payment of debts to the organization. 29/
In the future, Poland undoubtedly will register bilateral agreements
concluded with other members.
B. Agreements Within the Sino-Soviet Bloc.
1. USSR.
In March 1946 an agreement was concluded between Aeroflot
and LOT which permitted the establishment of a Moscow-Warsaw-Moscow
route by Aeroflot 62/ on a unilateral basis. A reciprocal bilateral
air transport agreement between Poland and the USSR was signed on
18 February 1955 and implemented by POlish aircraft on 7 April 1955. ?11/
2. European Satellites.
On 20 June 1955, Poland signed a civil air transport agree-
ment with East Germany. A series of bilateral agreements between the
USSR and the European Satellites and between individual Satellites
were signed at about the same time: -These agreements, all worded on
a standard form, gave the Satellites access to Moscow and reciprocal
air rights to one another's territory. The principal bilateral agree-
ments are as follows:
Country
Date Date
Signed Implemented
Czechoslovakia 24 January 1946 62 24 January 1946*
East Germany 20 June 1955 63 4 February 1956 L./
Rumania 29 November 1955 65
Albania 29 January 1958
The Warsaw-Tirana route is flown only by LOT. 61/
On 8 Jute 1957, Poland joined Bulgaria, Czechoslovakia,
East Germany, and Rumania in signing an agreement for collaboration
in the operation of scheduled air services. Previous agreements had
been of a bilateral nature, but now services between the capitals of
of the signatory countries are operated under a joint plan drawn up
by these governments. Details of the plan and method of pooling
services and dividing revenues are unknown.
* In November 1952, provision was made for automatic extension
unless the agreement were denounced.
** Presumably implemented soon after signing.
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3. Communist China.
It was rumored in May 1956 that a member of the Polish
Ministry of Transport would go to Communist China to negotiate for
a Polish air route from Warsaw to China) but no further developments
have been noted.
C. Agreements Outside the Sino-Soviet Bloc.
1. Europe.
Since late 1954) Poland, like other European Satellites,
has embarked on an aggressive policy of expanding civil air routes
and seeking bilateral transport agreements with other European govern-
ments. The resulting agreements may be listed as follows:
Country
Yugoslavia
Austria
Netherlands*
Sweden
Belgium
UK
France***
Date .
Signed
11 December 1955
8 February 1956 ?,9/
8 June 1956
31 July 1956** 72
November 1957 73
Date
Implemented
14 January 1956 2/
24 April 1956 70
8 June 1956 71
April 1958 TY
No. formal bilateral agreement has been signed between
Poland and Greece. In January 1957, however, the Greek government
granted Poland Third, Fourth, and Fifth Freedom rights****
* Implemented by KLM alone.
** Presumably implemented soon after signing.
*** The LOT stop at Paris presumably is effected under a World War
II unilateral Polish-French arrangement which has not been abrogated
by France. Air France has not initiated air services to Warsaw in the
postwar period and apparently does not contemplate inaugurating ser-
vice before 1959. /5/
xxxx Third Freedom -- the privilege to put down passengers) mail, and
cargo taken on in the territory of the state whose nationality the
aircraft possesses.
Fourth Freedom -- the privilege to take on passengers, mail,
and cargo destined for the territory of the state whose nationality
the aircraft possesses.
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between Athens and Warsaw. These rights were granted in the form of
a temporary and revocable permit at the request of the Polish govern-
ment. II/ Since April 1957, when the agreement was put into effect,
Poland has been operating a Warsaw-Budapest-Belgrade-Athens air
route.
In a report published in January 19580 the manager of
LOT, A. Skala, suggested the possibility of extending the present
Warsaw-Athens route to the Middle East. /9/ No negotiations are
known to be under way for new air agreements, but representatives of
LOT have spoken of extending international services to Africa and
the Far East. In November 1958 it was reported in the press that a
new air link between Warsaw and Zurich* would be opened in the near
future and that service to Rome would be established. ?2/
2. Middle East.
On 15 February 1956, Poland signed an air transport
agreement with Egypt. DJ Following the formation of the United
Arab Republic on 1 February 1958) the new government accepted this
agreement in an arrangement with ICAO. As of January 1959, however)
the agreement had not been implemented.
D. Relations with International Organizations.
1. ICAO.**
The membership of Poland in ICAO has presented a com-
plicated problem ever since the ratification of the Chicago Conven-
tion was deposited on 6 April 1945 by the Polish government-in-exile
in London. The succeeding Communist government did nothing to
abrogate the ratification, however, and Polish dues-to ICAO remained
unpaid from 1945 on. In June 1958 the Polish press announced that
Poland had established official membership in ICAO at the ICAO Assembly
meeting in May 1958. At that meeting, Poland arranged to pay back '
dues as well as dues for 1958 and was restored to the status of voting
member in ICAO. 182/
Fifth Freedom -- the privilege to take on passengers, mail, and
cargo destined for the territory of any other contracting state and
the privilege to put down passengers, mail, and cargo coming from any
such territory.
* The service to Zurich was scheduled as of January 1959.
** For further details, see Appendix B.
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2. TATA.
LOT is an active member of IATA, a group of 85 air
carriers of which 77 are active and 8 are associate members.
LOT does not belong, however, to the IATA Clearing
House, which has headquarters in London. Poland and other members
of the Bloc probably make use of the membership of CSA to collect
their international receivables.
IV. Competitive Capabilities.
Like Czechoslovakia, Poland occupies a pivotal position in civil
aviation, dealing with nations both inside and outside the Sino-
Soviet Bloc. Poland, however, lacks the advantage of geographic
position which enables Czechoslovakia to serve as a central exchange
point for traffic between East and West and has not the potential of
CSA for competition with the West.
Poland also shares with Czechoslovakia a favored position within
the Sino-Soviet Bloc in the allocation of new types of aircraft from
the USSR. With the receipt of the Tu-104 jet transport, Czechoslo-
vakia apparently gained an advantage over Poland in equipment.*
Since 1945, LOT has suffered from a conflict in operational pro-
cedures and from inefficiency resulting from the heterogeneous
character of its inventory of aircraft, some of which were acquired
from the USSR and some from the West.
Under the Five Year Plan (1946-50) the ton-kilometer volume of
all Polish air traffic was scheduled to increase by 50 percent, of
which passenger-kilometers were to account for 42 percent and ton-
kilometers the remaining 8 percent. 1.32Y Such an expansion) although
comparatively small, depends largely on the development of interna-
tional routes and will require new competitive aircraft. Because
Communist China and Czechoslovakia have higher priorities, Poland
may not soon be allotted the Soviet 11-18. Unless foreign exchange
is made available for the purchase of modern transport aircraft from
the West, it is difficult to see how LOT will be able to fly the
* The explanation probably lies in the Soviet policy of using the
same type of aircraft for airlines sharing the same route. CSA has
been flying the Prague-Moscow segment of the Prague-Moscow-Peking
route shared with Aeroflot, and when Aeroflot began using the Tu-104
to the Far East, it was natural to allot the same type of aircraft
to Czechoslovakia to speed up service from latking to Western Europe.
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international routes now scheduled as an effective competitor. The
goal of strengthening Polish civil aviation by extending services
outside the Bloc will be even more difficult to achieve. LOT has
little potential for competition in world civil aviation, and its
initiative is hampered further by the close coordination of the air
operations of the Bloc.
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APPENDIX A
CHRONOLOGY OF PRINCIPAL EVENTS
AFFECTING THE DEVELOPMENT OF CIVIL AVIATION IN POLAND
Date Event
1939 Polish Airlines (LOT) discontinued service under
the occupation by Nazi Germany.
6 April 1945
Poland deposited with the International Civil
Aviation Organization (ICAO) its ratification of
the Chicago Convention.
June 1945 The Lublin government was set up in Poland.
January 1947 Elections gave the Communists control of the
Polish government.
October 1947 Opposition leaders fled from Poland, leaving the
Communists in absolute control.
1949 LOT received I1-12 aircraft from the USSR as re-
placements for DC-3 aircraft.
1950 The Council for Mutual Economic Assistance (CEMA)
was established, and coordination of the air
services of the Sino-Soviet Bloc was begun.
1954
1954-55
7 April 1955
The USSR reversed foreign policies regarding civil
aviation.
Reciprocal air agreements were signed by the USSR
and the European Satellites.
LOT made its first flight to Moscow.
14 January 1956 LOT initiated flights. to Belgrade, implementing
the bilateral agreement with Yugoslavia. .
April 1957 LOT began operating a Warsaw-Budapest-Belgrade-
Athens air route.
November 1957 LOT initiated flights to London.
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APPENDIX B
RELATIONS OF POLAND
WITH Bat INTERNATIONAL CIVIL AVIATION ORGANIZATION (ICAO)
On 6 April 1945 the Polish government-in-exile in London deposited
with the International Civil Aviation Organization (ICAO) its ratifi-
cation of the Chicago Convention. The succeeding Communist government
did nothing to abrogate this ratification. fi2/
' In June 1948 the Polish observer at the second meeting of the ICAO
Assembly presented an aide memoire to the Secretary General of ICAO
stating that Poland intended to adhere to the Chicago Convention with
the exception of Article 5, on the ground that the ratification of the
Convention by the "London Government" of Poland in 1945 did not make
the present government a party to the Convention. L6/
On 8 June 1948 and again on 10 August 1948 the Polish Embassy in
Washington addressed notes to the same effect to the US as depository
of the Convention. The latter note contained the statement that "the
Polish government cannot recognize the legal validity either of the
signature or of the instrument of ratification of the International
Civil Aviation Convention, because they were executed and deposited
after 22 July 1944."
In its replies the US affirmed on 6 August 1948 and reaffirmed on
2 September 1948 the US position that it could not accept a Polish
instrument of adherence to the Convention, because the originAl rati-
fication on behalf of Poland was considered to have been in force
since 4 April 1947. 27
For more than 8 years following this exchange of correspondence,
the situation was unchanged. Poland did not participate in ICAO and
remained in arrears in its dues since 1945, with the result that its
vote in the ICAO Assembly was suspended. L82/
On 18 February 1957 the Legal Advisor of the Polish Foreign Office
expressed the desire of Poland to participate in ICAO and on 9 May
1957 notified the Secretary of State that Poland "has become a member
of the International Civil Aviation Organization." 227. The ICAO
Secretariat then wrote the Polish government calling attention to the
back dues owed by Poland but had received no reply by September 1957.
In June 1958, however, the Polish press announced that Poland had
established official membership in ICAO at the meeting of the ICAO
Assembly held in Montreal in May 1958. 91/
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Assembly Resolution A 11-1, which was adopted at that meeting,
contained an agreement that Poland would pay its back dues to ICAO
as follows: for the period up to 31 December 1956, $106,000 (after
a negotiated reduction); for 1957, $51,261. The total of $157,261
was to be paid in 15 annual installments commencing in 1961. Poland
agreed to pay forthwith the currentdues for 1958 of S49,021. 22/
Poland is therefore a full voting member of ICAO. .
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APPENDIX C
METHODOLOGY
A discussion of the methodology employed in Table 2* follows.
An article in the Polish magazine Transport, Warsaw, May 1958, gave
percentage distribution of items making up the operating expenses
of LOT for the year 1957. The percentages covered materials, wages,
amortization, and other expenses. The only heading for which a
figure in zlotys was available was the classification wages. The
Polish Statistical Year Book gives the total for wages for employees
of LOT for the years 1953-57.. By applying the known percentage of
expenses devoted to wages to the actual amount so spent, the figure
for the total operating expenses of LOT in 1957 was derived. The
given percentages for fuel, materials, amortization, and other ex-
penses then were applied to the figure for total.expenses.in order
to derive the amounts spent for these purposes in 1957. In deriving
the figures for 1953-56, it was assumed that wages had accounted for
the same proportion of total expenses as they did in 1957.
* P. 15, above.
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