Israeli airlines were gradually resuming flights to and from Tel Aviv Tuesday, ending a two-day strike.

The Histadrut federation of trade unions ordered employees of El Al, Israir and Arkia to return to work, after it reached an overnight agreement with the government that would allow the country’s three airlines to better compete with European ones.

The trade unions had threatened to broaden the strike to a complete shutdown of Ben-Gurion Airport Tuesday, affecting also foreign airlines.

The government agreed to cover some 97.5 per cent of the airlines’ security costs, rather than some 80 per cent as decided earlier, Israel Radio reported. Security for the Israeli airlines is seen as more costly than abroad.

A joint team would also look into other issues.

Thousands of passengers have been stranded in Israel and abroad, after El Al, Arkia and Israir cancelled their flights Sunday and Monday.

Prime Minister Benjamin Netanyahu’s cabinet Sunday ratified the Open Skies agreement with the European Union signed last year. The deal is to gradually allow unrestricted competition with airlines and destinations in Europe by 2017.

The unions warned the deal would lead to mass layoffs or even the collapse of the Israeli airlines.

The government said airlines have not done enough to become more efficient, and stressed that the deal will lower ticket prices and boost incoming tourism, creating thousands of jobs.

Histadrut chief Ofer Eini apologised for inconvenience caused to passengers.

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