PH, UK ink pact for possible air link

By Lawrence Agcaoili, The Philippine Star

Posted at Dec 12 2012 08:41 AM | Updated as of Dec 12 2012 11:26 PM

MANILA, Philippines - The Philippines inked an air service agreement (ASA) with the United Kingdom to boost bilateral trade between the two trading partners and for possible direct air link between Manila and London.

Hugo Swire, visiting United Kingdom Member of Parliament, announced in a forum sponsored by the Makati Business Club and the Management Association of the Philippines that the air pact was inked yesterday.

Swire said he signed the ASA with Transportation Secretary Joseph Emilio Aguinaldo Abaya and is scheduled to meet with Philippine Airline (PAL) president and chief operating officer Ramon S. Ang.

According to him, the air pact and the new visa services would boost travel between the Philippines and the UK.

“I expect that our new visa services will lead to many more visitors traveling between our countries. To help bring this about, I will sign a new air services agreement later today with Secretary Abaya, and meet Ramon Ang and Philippine Airlines, who hope to start direct flights to London soon,” Swire told businessmen prior to the signing of the agreement.

For his part, Civil Aeronautics Board executive director Carmelo Arcilla said the Philippines and UK tried to finalize a new ASA as early as 2009 but the pact was not signed.

Arcilla said the air agreement would have updated the ASA entered into by the Philippines and the UK way back in 1965.

He explained that details of the agreement including flight frequencies between the two countries would be finalized soon.

“It’s a comprehensive agreement that defines the aviation relationship of two parties. In 2009, there was an agreement but was not signed,” he stressed.

PAL, jointly owned by taipan Lucio Tan and diversified conglomerate San Miguel Corp. (SMC), is in the middle of a massive re-fleeting program involving the acquisition of 100 aircraft.

It entered into a $7 billion deal with Toulouse-based EADS in August to acquire 54 new Airbus aircraft consisting of 34 A321ceo, 10 A321neo, and 10 A330-300s that would be delivered starting next year.

The airline also exercised an option to acquire 10 more wide-bodied planes in another contract worth about $2.5 billion last September.

PAL currently maintains and operates 39 aircraft comprising of five Boeing B747-400s and three B777-300ERs as well as four Airbus A340-300s, eight A330-300s, 15 A320-200s, and four A319-100s.

SMC through San Miguel Equity Investments Inc. controls about 49 percent of Trustmark Holdings of PAL after infusing $500 million. Trustmark and affiliate Zuma Holdings own PAL Holdings and sister airline AirPhil Express.

PAL is set to ask the European Union from an exemption from a ban on Philippine carriers from European airspace using its certification from the International Air Transport Association (IATA) as well as its connections with European companies.

In April 2010, the 27-member European Commission decided to impose a ban Philippine carriers including PAL from European airspace for the failure of the Civil Aviation Authority of the Philippines (CAAP) to reform the country’s civil aviation system.

In 2008, the safety rating of the Philippines was downgraded by the US Federal Aviation Administration upon the recommendation of the International Civil Aviation Organization (ICAO) to Category 2 from Category 1.