Tuesday, March 22, 2011

http://philippinesaviationnews.blogspot.com/22



1. PHL 'pocket' open skies policy excludes NAIA

The “pocket" open skies policy excludes the Ninoy Aquino International Airport (NAIA), with the Philippine aviation panels to declare which secondary airports are liberalized in favor of foreign airlines, Malacañang said Thursday.

President Benigno Aquino III signed Executive Orders 28 and 29 on March 14, liberalizing the entry of foreign airlines with a view to increasing air traffic into the country, Ricky Carandang, head of the Presidential Communications Strategic Planning and Development Office, told reporters in a press briefing.

“The intent of the orders was to liberalize the entry into secondary airports right now," Carandang said. It is up to the panel to determine which secondary airports will be part of the policy, he added.

“We hope it will bring in more tourists, more investments, and spur a competition in the Philippine aviation industry and to allow it to be competitive internationally," he said, noting that the Aquino administration is looking forward “to increasing air traffic coming into the Philippines.

The twin EOs should be taken together because EO 28 defines who is in charge of the liberalization process and EO 29 explains the policy, according to the Malacañang official.

EO 28 is for reorganizing the Philippine Air Negotiating Panel (PNAP) and the Philippine Air Consultation Panel (PACP), and EO 29 authorizes the Civil Aeronautics Board (CAB) and the Philippine Air Panels to pursue more aggressively the international civil aviation liberalization policy, he explained.

A concept of reciprocity

A vital feature of the pocket open skies policy is the concept of reciprocity, Carandang said. “Domestic aviation would still be primarily in the hands of local carriers. So we believe that with those actions, the local aviation industry will have the ability to continue to compete," he said.

The Palace official delved into the issues hounding such a policy, and referred to the reciprocity concept as a possible but not an absolute solution to problems that may crop up when a country open is skies to foreign airlines.

“There are some questions about how much rights are [going to] be allowed to foreign carriers and how much rights we will be given in exchange. There’s a concept of reciprocity which can be defined in different ways. The EO and the economic team, as I understand, are taking the broadest definition of the reciprocity here," Carandang said.

“We’re not going to say if we’re allowed one flight there, then they must be allowed one flight here. But we recognize the benefits of having flights here on [their] own in terms of tourists that are allowed to come in, the number of investment that is generated." These “can be viewed as reciprocity," according to the Palace official.

SEAir has no objections

In an interview, SEAir president and CEO Avelino Zapanta told GMA News Online he has no objections to foreign airlines operating under an unlimited service policy in the Philippines.

"Open skies policy would help the domestic economy. It will increase jobs, boost businesses, and lift the tourism of the Philippines," said Zapanta, a proponent of the open skies policy.

He said liberal air policies would allow the Philippine aviation industry to catch up with other members of the Association of Southeast Asian Nations.

Now that the Philippines in going open skies, "the country is closing up to the idea of being a laggard in the industry," Zapanta said.

With the policy in place, it is high time for the government to help improve all airports in the country, according to the SEAir CEO. "That way, we're showing to the world how we keep up in a modernized way," he said.

PANP responsibilities

EO 28 designates the PANP, after it has been reconstituted and reorganized, to hold initial negotiations of relevant air service agreements with foreign airlines.

While the new panel will have the Foreign Affairs secretary as chair and the departments of Trade and Industry, Transportation and Communications (DOTC), Labor and Employment (DOLE), Tourism, and the CAB as members, the official carries of the Philippines under the policy may join the negotiations as observers.

The PACP, on the other hand, is responsible for succeeding negotiations of air service and similar agreements. The new PACP will have the DOTC secretary as chair, with the CAB executive director as vice chair and the same departments under the PANP as members including Foreign Affairs.

2. Gov't says no need to modify 'open skies' EO

MANILA, Philippines - There is no need to modify the recently issued executive order (EO) on open skies to address the concerns of Cebu Pacific Airlines, Malacañang said yesterday.

Secretary Ramon Carandang of the Presidential Communications Development and Strategic Planning Office was responding to a call from the airlines for a modification of EO 29, which it said would only benefit foreign carriers.

“EO 29 will benefit the industry and the country. We believe Cebu Pacific’s concerns can be addressed without modifying the EO,” Carandang said.

Asked how this could be done, Carandang said the primary problem of Cebu Pacific and also of Philippine Airlines was the downgrading of the Philippines to Category 2 status, which is already being addressed by the government.

“We’re confident that if we regain access to European destinations, and we are taken off Category 2, all of the concerns of Cebu Pacific would be addressed,” he said.

Asked about Cebu Pacific’s concerns about reciprocity, which it believes should be a prerequisite in any air-rights negotiation, Carandang said the airline was “addressing reciprocity on a one-on-one basis, attributing this to the EO, although the problem is not related to the EO. Cebu Pac has proved it is capable and can compete. It is the downgrade that is affecting the Philippine market, not access,” he said.

In 2008 the US Federal Aviation Authority downgraded the Philippines to Category 2 status because of findings that it has significant security risks, which has prevented Philippine carriers from expanding their US operations.

Last year the European Commission banned Philippine carriers from European airspace due to the safety assessment made by International Civil Aviation Organization on the country in September 2009 and the FAA downgrade in 2008.
3. Philippine leader vows to open up aviation sector

SINGAPORE — Philippine President Benigno Aquino has vowed to open up his country's aviation sector to foreign competition in a bid to boost tourism, and appealed for greater Singaporean investment.
Speaking to business leaders in Singapore, Aquino said his government was finalising a decree that will allow foreign airlines to fly to major destinations in the country.
The executive order "will liberalise the entry of foreign carriers in a way that will not decimate our local carriers," said Aquino, who was elected nearly a year ago on promises to reform the economy and tackle corruption.
"Under this order, we will allow foreign carriers to fly into key destinations in the Philippines."
The Philippines has lagged behind Southeast Asian neighbours in the race to attract tourists despite boasting white-sand beaches, exotic diving spots and other natural wonders, partly because of poor transport across the archipelago of more than 7,000 islands.
Aquino also said he had given aviation officials one year to resolve issues that led Europe to ban Philippine carriers from flying to the continent and prompted a downgrade by the US Federal Aviation Administration (FAA).
"We are also addressing technical and regulatory issues that have been allowed to worsen in the previous decade. This led to the banning of Philippine aviation into Europe and the downgrading of Philippine carriers to category 2 under US FAA regulations," said Aquino.
"Once these bottlenecks have been resolved we will embark on an aggressive marketing campaign that will brand and sell the Philippines as a key tourist destination in the outside world."
Philippine carriers were stopped from expanding services to the United States in 2008 and banned from Europe in March 2010 over concerns airline safety was not in line with international standards.
Aquino also urged Singaporean businesses to take part in the Philippines' growth story.
"We invite all of you to be part of our own reconstruction. Your government has already signified its willingness to help a brother nation reach the same heights that you have reached," he said, noting that his country grew 7.3 percent last year.
Aquino is the son of Philippine democracy champion and former president Corazon Aquino. He won the May 2010 elections on a platform to fight corruption, which has plagued the Southeast Asian nation for decades.

4. Foreign groups back open-skies EO
The Joint Foreign Chambers is backing the Aquino administration’s implementation of an open-skies regime through EO 29, saying this would better allow market forces to come into play and ultimately boost tourist arrivals in the country.

In a statement issued Tuesday, the group said the policy was in line with President Aquino’s promise that “the Philippines is open for business under new management.”

EO 29, which ushers in a “pocket” open skies regime, eases restrictions on foreign airlines in international airports outside Metro Manila. It gives the Civil Aeronautics Board authority to grant additional frequencies or capacities to foreign carriers, but still prohibits cabotage.

Cabotage refers to a foreign airline’s transport of people or goods between two or more points within the country.

While local carriers Philippine Airlines and Cebu Pacific Air were staunchly opposing the implementation of the EO, saying it would give foreign carriers undue advantage, the foreign chambers said its benefits to the country were far-reaching.

Aimed at increasing tourist arrivals, the group said EO 29 would result in more jobs and revenues for people directly and indirectly involved in the tourism service industry.

The group noted that for every foreign tourist who visits the country, an average of $1,000 is spent and one direct or indirect job is created, many of which are in rural areas and less developed provinces.

“We wish to extend full support for President Aquino’s visionary leadership on civil aviation embodied in EO 29. The policy allows market forces to determine supply and demand of seats to secondary gateways throughout the country,” the JFC said. “With this new policy, the administration has taken a giant step toward its goal of doubling annual tourist arrivals to more than six million by 2016.”

Apart from pocket open skies, the group also sought the removal of the common carriers’ tax and the gross Philippine billings tax “to unleash the creativity and dynamism of the private sector.”

“Continuation of these taxes risks losing some of the present international air services into the country, as well as deterring new ones, and departs from standard international practice,” the JFC said.

“With these proactive reforms of the Aquino Administration, we can look forward to continued rapid expansion of the aviation market in the Philippines, more competitive pricing and better service, and new routes to drive tourism, investment and employment,” it added.


By

NEHA JAIN

      

   

     



            
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