More Chinese airlines to fly to Australia under new plan

SYDNEY - More Chinese airlines will be allowed to offer services to Australians under a new plan announced on Friday.

Australian and Chinese airlines will be able to operate 26,500 seats a week between the major gateways immediately, with a further 7000 weekly seats to be phased-in over the next two years, according to the new agreement announced by Deputy Prime Minister Warren Truss and Trade Minister Andrew Robb.

The new agreement will allow Chinese airlines to almost triple their services to Australia over the next two years and offer cheaper flights to Australians bound for Europe and North America.

The plan is also designed to cater to the growing number of Chinese tourists coming to Australia.

Chinese airlines had reached the previous cap of 18,029 weekly one-way seats at certain times of the year, meaning no new services could be added by existing carriers or launched by new ones looking to enter the market. By October 2016, 33,500 seats each way will be available each week.

These second-tier Chinese carriers include Hainan Airlines, Shenzen Airlines and Xiamen Airlines and the deal will allow them to increasingly target Australian passengers by using their home cities as hubs for European flights in competition with airlines such as Qantas, Emirates, Singapore Airlines and Cathay Pacific.

Infrastructure and Regional Development Minister Warren Truss said making it possible for Asian markets to grow is a key priority.

"The Australian government is committed to ensuring that we have the aviation capacity necessary to meet future demand into and out of foreign markets and recognize the potential of Australia as a prime tourist destination within the Asia-Pacific region," he said in a statement.

Robb said almost 760,000 Chinese visitors spent close to 5?billion Australian dollars ($5 billion) in Australia during 2013-14 and the number of Chinese traveling abroad is set to double to 200 million by 2020.

"Tripling aviation capacity from China to Australia over the next two years will ensure we are well placed to capture our share of this growth," Robb said.