ASEAN Single Aviation Market: Manila, The Last Odd Man Out


PETALING JAYA: Indonesia has signed a deal to allow Asean airlines to make unlimited flights to Jakarta, The Straits Times has learnt – a move which could lead to cheaper fares and more flight options for travellers flying within the region.

The move follows a campaign which started about a decade ago to get the 10 Asean nations to remove all restrictions on flights from their countries and push to become one aviation market – similar to the European Union’s “single sky”.

Indonesia had been reluctant to sign up to the agreement but now that its capital is on board, aviation experts are confident that other Indonesian cities will follow suit.

The Philippines’ capital Manila is the only other Asean capital yet to join the agreement, although the country has already removed restrictions on flights to other cities.

Aviation law academic Alan Tan of the National University of Singapore told The Straits Times that Indonesia’s agreement is “very significant”.

He said: “It signals Indonesia’s desire to liberalise market access into its cities and to support the Asean single aviation market ambition.”

Asean transport ministers began the push for liberalisation in the air travel sector in an effort to boost trade and tourism, setting a deadline for unlimited flights within the region by the end of next year.

If the move goes ahead, it would mean, for example, that Singapore Airlines could fly to any part of the region as often as it wants – without any flight restrictions – as long as it believes there is demand and it can get landing slots from airports.

Typically, the number of flights a carrier can operate to a destination is determined by deals between the government of the country where the carrier is registered and the government of the country it is flying to.

Such negotiations can be complicated because not all airlines are equal and governments worry that their national carriers may not be able to compete effectively with airlines from the other country.

Although Indonesia and the Philippines have yet to fully sign up to the agreement, Singapore’s transport ministry is confident that next year’s deadline will be met.

A spokesman said: “Given that all Asean member states have reaffirmed commitment to work towards 2015 obligations, we can expect Indonesia and the Philippines to fulfil their outstanding obligations by end-2015.”

The spokesman added that transport plays a “vital role” in the economic development of the region, and liberalisation will benefit all carriers within the bloc by giving them growth opportunities and enhancing their competitiveness.

However, Prof Tan stressed that there are other milestones to be achieved if Asean is to truly exist as a single aviation market.

These include removing restrictions that prevent a carrier from setting up a wholly owned subsidiary in a different Asean country and allowing an airline from one country to operate domestic flights in another.

Tony Tyler, chief executive officer and director-general of the International Air Transport Association, said earlier this year that another big challenge for the region is to ensure “the availability of efficient infrastructure” such as adequate airport and runway capacity.

Source: The Straits Times/ANN