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CAL's rating upgraded
Taiwan Ratings Corp (中華信評), a local arm of Standard and Poor's, said yesterday that it has revised upward its credit rating outlook on China Airlines Co (華航) from negative to stable.

"The outlook revision reflects restoration of the company's profitability, which was severely dampened during the outbreak of SARS in the second quarter of 2003, to normal levels and should remain stable in 2004," the agency's credit analysts said in a statement.

The airlines' passenger traffic and load factor slumped during the outbreak. But the waning of the impact of SARS, combined with the carrier's promotional campaign and the effect of peak travelling season, all helped the airline's load factor rebound to 80 percent in the third quarter from a low of less than 40 percent in May.

The carrier is expected to receive delivery of 26 new aircraft between this year and 2007 on a total capital expenditure of NT$125.3 billion.

While this capital expenditure program may increase the airlines' net debt over the next four years, Taiwan Ratings said it anticipates the carrier's two cash injections and a plan to issue convertible bonds between next year and 2007 will help support the expenditure.

New Year charters' outlook dim
Taiwanese airlines are not optimistic on launching a second round of charter flights for Taiwanese businesspeople and their families in China for the coming Lunar New Year holiday, according to an industry source.

Despite Beijing's claims that it is willing to assist in the charter project, the carriers are not holding out much hope for the plan, said Solo Su (蘇賢榮), secretary-general of the Taipei Airlines Association (台北市航空運輸公會).

Six Taiwanese airlines took part in the historic plan last time, but Su said their response will be lackluster if the flights are to be carried out based on the same model. He cited the lack of any profits as the major reason behind their lack of interest.

He also said Beijing's demand that Chinese carriers join the service next year would make it impossible as a result of technical issues related to law enforcement, such as two-way negotiations.

Power woes hurt Taiwanese
Shanghai will have power shortages for at least two years, a Chinese-language newspaper reported, citing unidentified officials of Taiwanese companies with factories around the city.

China's electricity demand this year rose about 15 percent to 1.9 billion megawatts, the largest jump in 30 years, the paper said, citing government statistics. Power failures shut down companies for a least two days a week during the summer months.

Some companies that have set up units in government-run industrial parks such as AU Optronics Corp (友達光電) and He Jian Technology (Suzhou) Co (和艦科技) have secured guaranteed supplies of power, the report said.

APEC symposium for Taipei
The 2003 Symposium on APEC Network of Pharmaceutical Regu-latory Service will be held next Monday and Tuesday in Taipei with experts from the US, France, the UK, the Netherlands, Australia, Japan, South Korea, Singapore and other countries in the Asia-Pacific region participating.

Murray Lumpkin, principal associate commissioner of the US Food and Drug Administration, will deliver a speech as will Thomas Lonngren, executive director of the European Agency for the Evaluation of Medical Products.

NT dollar gains ground
The New Taiwan dollar yesterday traded higher against its US counterpart, rising NT$0.014 to finish at NT$33.995 on the Taipei foreign exchange market. Turnover was US$496 million.

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