Poland's historic capital, Cracow, was long a beautiful backwater. The stunning medieval buildings could not mask the poverty, and the world largely passed it by.

Then the cheap flights began arriving. First it was Germanwings, flying from Cologne, followed by SkyEurope, easyJet, Ryanair and Centralwings, bringing travellers from across the rich West to Poland’s southern city. There is now a daily flight from Liverpool to Cracow.

Last year three million tourists visited Cracow — 50 per cent up since 2004. Property development has mushroomed, with two new five-star hotels expected this year, and tens of thousands of jobs created.

“The revitalisation is visible. People are happy because they are earning money. The city is looking better,” said Artur Zyrkowski, head of tourism for the city. The low-cost airlines have transformed neighbouring Katowice from grimy post-communist obscurity to another tourist gateway, with a million passengers last year, and a new shopping mall and airport terminal being built.

The low-fare revolution that has swept the airline industry is now sweeping Eastern Europe, integrating the former communist countries into the EU more effectively than any government programme.

Low-cost airlines have been around in Western Europe since deregulation of the skies a decade ago, but they got going in Eastern Europe only after the former communist states joined the EU in 2004.

Jan Skeels, of the European Low Fares Airlines Association, said: “As soon as they joined the EU, they had to adopt EU legislation and open up their skies. Beforehand there was a bit of protectionism. They are a bit further behind — there is still quite a lot of growth in the Eastern market.”

As well as Western low-fare airlines, entrepreneurs in Eastern Europe have been setting up their own operations, such as Hungary’s Wizzair. They are bringing tourists, business people and buyers of second homes east, and entrepreneurs and jobseekers west.

Prague and Budapest may have led the way, but the airlines are spreading their tentacles to ever-remoter destinations. EasyJet last week opened up a route from Luton and Bristol to Rijeka in Croatia.

There plenty of airport sites in Eastern Europe — including disused military bases from the old Warsaw Pact days.

Opening just one route can have an extraordinary impact on a country’s tourism industry. In 2004 easyJet started flying to Ljubljana, the capital of Slovenia, and the number of visitors jumped by 50 per cent in one year.

Towns are seeking a slice of the action, offering marketing deals to get airlines to add them to their list of destinations. Mirabor, Slovenia’s second city, has a campaign to get Ryanair to land. The tourism can give a great boost to the eastern economies. Tallinn, capital of Estonia, has been transformed by the influx of holidaymakers, who exceeded three million in 2004. Helena Tshistova, of the Tallinn tourist board, said: “There are a lot of new hotels and new buildings, new shopping centres and modern buildings in the city centre — and we’ve been renovating the old town.”

The low-cost airlines are also bringing people who are buying second homes. A quarter of a million British families now have properties overseas. Mandy Westmoreland, director of A Place in the World, an estate agent that helps people to find properties overseas, said that the impact of the low-cost airlines was highly significant. “You can go for a weekend in Bratislava or Prague. It used to be just the rich who could afford to go to Paris for a weekend, but now someone on an average income can go to Budapest for a weekend.”

THE CHEAP SEATS

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