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ASEAN gears for open skies
POSTED | 6:21 AM | 16-09-2014

ASEAN gears for open skies

-- By George Neal

The countdown has begun for the ASEAN Economic Community (AEC). And with the formation of the ASEAN Single Aviation Market (ASEAN SAM) – or the Open Skies Agreement – two multilateral agreements will help improve regional connectivity and enhance regional trade.

The two agreements are the ASEAN Multilateral Agreement on Air Services (MAAS) and the ASEAN Multilateral Agreement on the Full Liberalization of Passenger Air Services (MAFLPAS). 

Eight of the 10 ASEAN governments have already ratified the first phase of the ASEAN-SAM, which entails opening up capital city routes to all ASEAN-based airlines. Two member states -- Indonesia and the Philippines -- have not signed the agreement. 

The other 8 member states are Thailand, Singapore, Malaysia, Brunei, Cambodia, Laos, Myanmar and Vietnam. The grouping is a market of 600 million people, with a combined Gross Domestic Product of US$1.8 trillion. If it were a country, ASEAN’s economy would be the ninth largest in the world. 

According to Professor Alan Tan of Aviation & Maritime Law School, National University of Singapore, Indonesia constitutes half of ASEAN's population, so this is a huge drawback. “It's a bit like the European Union doing this without France, Germany and Britain combined,” said the academic.

Mr Tan also questions whether ASEAN-SAM provides “Partial Open Skies” because the seventh freedom and domestic travel were not included. (See 9 Levels of Freedom at the end of this article). 

Civil aviation experts are nonetheless optimistic about ASEAN’s Strategic Transport Plan and Air Transport Goal. The liberalization of air transport framework is seen to benefit unlimited passenger demographics within the ASEAN. In terms of tourism, liberalization will help travellers fly directly from point to point – rather than transit via another airport with a waiting time of at least two to three hours. 

ASEAN has come a long way in terms of opening skies agreement. In reality, ASEAN governments have to admit that they’re going to lose some of their sovereignty with successful implementation of the ASEAN SAM.

Therefore, is it possible for member states and regional airlines to change their mindset and think in terms of ASEAN, not as their own country anymore?

Is it possible for ASEAN to think as ASEAN – not as an Indonesian, Malaysian, Singaporean or Thai? Moving ahead as AEC, how will ASEAN people be able to come together? 

Readiness of airlines and airports in ASEAN are another matter altogether. Airport expansion and infrastructure developments are required to be supportive to service-increased passenger traffic. For example, Singapore’s Changi International Airport has plans for Terminal 4, Terminal 5 and a 3rd runway as it anticipates 135 million passengers per year by 2020 with the formation of the ASEAN Single Aviation Market.

Mr Raman Narayanan, regional head of ASEAN for Air Asia, suggests that the next step is to privatize airports, eliminate immigration and implement further structural changes for the flow of human capital. He called for ASEAN governments to amend aviation laws, suggesting that most of the regulations drawn up since the 1960s have not reflected the changes brought about the Low Cost Carriers (LCC), which have changed the aviation environment drastically.

According to Mr Narayanan, the private sector is moving way ahead in adopting technology which will be of great benefit to aviation. “I dream of a day when we don’t have to carry passports. All of our data is stored in the clouds, you just walk through a scanner and it tells you where you are,” said Mr Narayanan.

Levels of Freedom

1. To fly across the territory of either state without landing.

2. To land in either state for non-traffic purposes, e.g. refueling without boarding or disembarking passengers.

3.  To land in the territory of the first state and disembark passengers coming from the home state of the airline.

4.  To land in the territory of the first state and board passengers travelling to the home state of the airline.

5.  To land in the territory of the first state and board passengers travelling on to a third state where the passengers disembark, e.g., a scheduled flight from the United States to France could pick up traffic in the UK and take all to France (sometimes termed beyond rights).

6. To transport passengers moving between two other states via the home state of the airline, e.g. a scheduled flight on an American airline from the United Kingdom lands in the US and then goes on to Canada on the same aircraft.

7.  To transport passengers between the territory of the granting State and any third State without going through the home state of the airline, e.g. a scheduled flight on an American airline from the UK to Canada that does not connect to or extend any service to/from the US.

8. To transport cabotage traffic between two points in the territory of the granting state on a service which originates or terminates in the home state of the foreign carrier or (in connection with the so-called Seventh Freedom) outside the territory of the granting State (also known as consecutive cabotage), e.g. an American airline flies from the US lands passengers in London and then boards passengers to fly to Manchester.

9. To transport cabotage traffic of the granting State on a service performed entirely within the territory of the granting State (also known as stand alone cabotage), e.g. a British airline operates a service between Perth and Sydney in Australia).

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