Air travel to open wider to investors
By Zhao Huanxin (China Daily)
Updated: 2004-10-31 23:03

With the fastest growing air transport market in the world, China pledged Sunday to open the aviation sector wider to private and foreign investment while spurring development of regional airlines.

The effects of SARS (severe acute respiratory syndrome) virus, which haunted many parts of the country last year, turned out to be short-lived and the country's air travel picked up very quickly, said Gao Hongfeng, vice-minister of the General Administration of Civil Aviation of China (CAAC).

In the first nine months of this year, more than 90 million passengers travelled by air in China, a surge of 50.2 per cent year on year, show the latest statistics of the CAAC.

Speaking at the International Aviation and Aerospace Forum, Gao said air transport in China is growing at a pace unseen in other countries and holds unmatched development potential.

"In the whole of 2004, the number of air travelers in China is expected to rise to a record high of 120 million."

As the country's rapid economic development will continue to stoke demands for air transport, the civil aviation sector will realize sustainable growth by implementing revamping and reforming policies, he said.

Gao said in the years ahead, administrative limits required for civil aviation projects will be reduced to create allow enterprises to compete on a fair footing, while guaranteeing the interests of the State, enterprises and consumers.

For example, operation rights for domestic air routes will be subject to ever-relaxing procedures, he said.

In addition to State-owned firms, foreign and private companies will be "guided and encouraged" to invest in air transportation, airports and other civil aviation projects, he said.

"We'll actively adapt ourselves to the global air transport liberalization tendency by phasing in the opening of China's air transport market," he said.

The vice-minister did not specify, but he said his agency will support code-sharing between Chinese and foreign airlines and for them to forge strategic partnership or instigate other joint marketing efforts.

Between 1980 and 2003, more than US$30 billion in foreign investment was pooled into China's civil aviation sector in projects including plane and engine maintenance, ground service and air catering, Gao said.

The vice-minister also said China will step up international collaboration to prevent terrorism threatening civil aviation safety.

Yang Yuzhong, vice-president of the China Aviation Industry Corp I (AVIC I), China's major aircraft manufacturer, Sunday said his company aims to become the country's leading regional airliners supplier.

Demands on regional jets will be growing in China as air travel between small and medium-sized cities becomes more frequent, said Liao Quanwang, vice-director of the Aviation Industry Development Research Centre of China.

With the optimization of the country's air routes and fleet structure, the country's airlines will favour planes with 50 to 70 seats, according to a statement from the centre.

The AVIC I announced the ARJ21, China's advanced regional jet programme, four years ago. Before manufacturing of ARJ21 started last December, the company had already clinched 35 orders the jets, said company president Liu Gaozuo.

"We offer regional jets of the best quality but at a price and operational cost up to 10 per cent lower than foreign counterparts," Liu said. "More importantly, we provide products that most suit Chinese market needs."

The forum precedes the week-long 5th Airshow China, that officially started Sunday afternoon. The biennial event has been held in the coastal city of Zhuhai in South China's Guangdong Province since 1996.

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