FDX to triple # of flights to China:
Thursday April 8, 6:26 pm Eastern Time
U.S. and China sign civil aviation pact
By Tim Dobbyn
WASHINGTON, April 8 (Reuters) - The United States and China on Thursday signed
an agreement to double aviation traffic between the two countries, adding new carriers
and destinations over the life of the three-year pact.
Chinese Foreign Minister Tang Jiaxuan joined U.S. Secretary of State Madeleine
Albright and Transportation Secretary Rodney Slater in a signing ceremony at the State
Department.
''Restrictions in our aviation agreement have held back development of air services,'' Albright said in a statement. ''With
this new agreement, air services will be able to grow along with overall bilateral trade,'' she said.
As detailed Wednesday by senior officials, the current 27 weekly flights available to each country will gradually rise to 54
by April, 2001, when both China and the United States will also get to add a fourth carrier.
The three U.S. carriers serving the market at the moment are Northwest Airlines Corp. (Nasdaq:NWAC - news) and
UAL Corp.'s (NYSE:UAL - news) United Airlines and FDX Corp.'s (NYSE:FDX - news) Federal Express package
service.
Federal Express has said it aims to triple the number of flights per week to China to 12 from four at present.
The U.S. Department of Transportation will consider applications by U.S. carriers for new service.
''Airline consumers, businesses and the effort to expand trade and travel throughout the world will be well served by this
significant expansion of service,'' said Slater.
U.S. passenger carriers were previously restricted to serving just three Chinese cities: Beijing, Shanghai, and Guangzhou.
The new agreement will allow the United States to select two more points in China.
The new pact also lets U.S. carriers serve China from any point in the United States.
In return, China may select two more points in the United States to be served from China. Previously, service was limited
to 10 U.S. cities: Anchorage, Atlanta, Chicago, Fairbanks, Honolulu, Los Angeles, New York, Portland, San Francisco
and Seattle.
AMR Corp.'s (NYSE:AMR - news) American Airlines, Delta Air Lines Inc. (NYSE:DAL - news), United Parcel
Service of America Inc. [UPS.CN] and Polar Air Cargo have all expressed interest serving China.
The 27 weekly flights available to each country will increase to 35 immediately, 44 on April 1, 2000 and 54 on April 1,
2001.
Even airlines that do not get direct access should benefit from an agreement to expand code-sharing arrangements that
allow airlines to sell tickets on each other's flights.
U.S. negotiators said their counterparts had recognized the longer-term benefits of the pact despite the depressing impact
of the Asian economic crisis on Chinese carriers.
The three Chinese airlines currently serving the United States are China Eastern (NYSE:CEA - news) , China Southern
Airlines and Air China.
Further negotiations will be held within a year on issues including additional market entrants, code-sharing between
same-country airlines and third-country code-sharing.
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