Posted on: Monday, July 26, 2004

U.S., China expand flights

By Joe McDonald
Associated Press

BEIJING — China and the United States signed an aviation agreement Saturday to expand flights in the booming market between the two countries and drop most restrictions on each other's airlines.

The pact will increase numbers of passenger and cargo flights allowed by Chinese and U.S. carriers in stages over the next six years, rising from the current 54 per week to 249. To start, each side gets 14 more weekly flights in August.

The deal could ease shortages of seats that have prompted complaints from tourists and business travelers.

The pact eventually will eliminate most limits on schedules and which cities Chinese and U.S. carriers can serve in the two countries, said U.S. Transportation Secretary Norman Mineta.

"It's just a smidgen away from being an 'open skies' agreement," Mineta said before a signing ceremony with China's aviation minister, Yang Yuanyuan.

The deal should lower fares by increasing competition, replacing "very restrictive" terms that have blocked carriers from meeting demand for passenger and cargo flights, Mineta said.

"Exponential growth in our trading hasn't been reflected in terms of what's going on in transportation," he said. The new deal "gives Chinese carriers as well as U.S. carriers a chance to exercise the potential in this marketplace."

The agreement allows the two sides to reopen talks in 2006 on whether to liberalize air travel further, Mineta said.

It allows each side to name five new airlines to fly between the two countries, according to Karan Bahtia, an assistant U.S. transportation secretary for aviation who traveled with Mineta.

The U.S. government on Friday picked United Airlines and Northwest Airlines, which already fly to China, to make the first additional flights under the new agreement.

American Airlines said it asked to delay awarding the routes until next year, when it plans to apply for approval to fly to China. But Bahtia said Washington acted immediately in order to increase services as quickly as possible.

Bahtia said the new agreement will eliminate restrictions that until now have limited U.S. airlines to serving five cities in China and Chinese carriers to 12 American cities.

It wasn't clear which additional airlines China might name for service to the United States. Beijing is in the midst of an effort to consolidate its industry into groups based around three major carriers.