Wed, Sep 27, 2000 page1

• Aviation dispute with Philippines ends

  AGREEMENT The Philippine side caved in to Taiwanese demands, specifically over sixth freedom rights, in a spat that has cost Taiwan's southern neighbor enormously

  • By Cybil Chou / STAFF REPORTER WITH AGENCIES
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  Taiwan and the Philippines signed a new aviation agreement yesterday, ending a yearlong aviation row that cut air links between the two countries and disrupted investment, tourism and the importation of labor to Taiwan.

  The new agreement effectively gives Taiwanese airlines more than 10,000 passenger seats a week, including chartered flights to the Philippines, and the right to transport people and cargo from Manila to third countries via Taipei.

  The Philippines had accused Taiwan of poaching passengers and demanded that Taiwanese carriers China Airlines (中華航空) and EVA Airways (長榮航空) reduce their weekly quota of seats. When Taiwan refused, Manila unilaterally scrapped a 1996 air agreement with Taipei in October and both sides severed air links.

  

  Chang You-hern, director general of the Civil Aviation Administration, front left, shakes hands with the acting Director of the Philippines Civil Aviation Authority Emmanuel Cruz at yesterday's signing ceremony to restore air links between the two countries. Standing behind Chang is Chan Hsien-ching, representative of the Taipei Economic and Cultural Office in Manila, shaking hands with his counterpart Rodolfo Reyes, Manila's de facto ambassador in Taipei.

  PHOTO: CHUANG CHUNG-LUNG, TAIPEI TIMES

  Flights were resumed in February but were cut again March 15, after each side accused the other of reneging on agreements. The air dispute has soured relations between the two historically friendly neighbors.

  By unilaterally canceling the air pact, Manila ignored international procedures that call for a one-year warning before an air agreement is terminated, Taiwanese officials said.

  But yesterday, Philippine officials appeared to have caved in to Taiwanese demands because of the mounting economic toll the severed air links had on their country.

  "If our Philippine counterpart breaks the agreement again, the bilateral air links will be permanently terminated," said Chang You-hern (張有恆), director general of the Civil Aeronautics Administration.

  "We have written down the details in the new agreement that leaves no room for misinterpretation," said Rodolfo Reyes, representative of the Manila Economic and Cultural Office, Philippines' unofficial embassy in Taiwan.

  Chang said the most contentious issue was Taiwan's right to take passengers to third countries, known in the aviation industry as ``sixth freedom rights.''

  "This was a very important aspect. Now sixth freedom rights are clearly stipulated in the new agreement,'' Chang said after the signing ceremony.

  Under the new deal, the carriers of both countries will each be allowed to fly 4,800 passengers weekly between Taipei and Manila, and 1,700 passengers between Taiwan's southern port city of Kaohsiung and Manila.

  Both sides will also be allowed to fly 450 passengers from Taipei to any other point in the Philippines apart from Cebu and Manila, and 3,100 seats are allowed for several local airlines to provide chartered flights services to Philippines cities excluding Manila.

  "We will have meetings with the airlines soon to discuss how the number of flight seats will be allocated to each respective airlines," Chang Kuo-cheng (張國政), deputy director general of the Civil Aeronautics Administration, told the Taipei Times.

  The pact also increases cargo volume to 360 tonnes from 270 tonnes a week, according to the new deal.

  Philippine President Joseph Estrada reportedly said on Monday that he ordered Reyes to sign the new agreement, even if it meant financial losses for debt-ridden Philippine Airlines (PAL).

  In Manila, PAL President Avelino Zapanta acknowledged the airline will be forced "to improve services some more" to compete with Taiwanese carriers. He said that PAL, Asia's oldest airline, would stand to lose about US$800 million annually because of the deal.

  "We could lose the national carrier. That's when people will start waking up," Zapanta said yesterday.

  "We expect to resume flights in mid October at the earliest," said Cindy Lin from Philippine Airlines' Taipei branch office.

  Officials at China Airlines said that the specific timing of when flights would be resumed is still under study because the airline needs extra time to reschedule flights.

  The air row has proven costly for the Philippines, where first-quarter Taiwanese investment has dropped 72 percent to US$390,000, compared to the same time last year, according to the Ministry of Economic Affairs.

  Additionally, Reyes indicated that tourism from the Philippines to Taiwan had dropped 75 percent since the suspension of air links last October.
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