Asian airlines seek solutions to promote BIMP Eaga travel

Asian airlines revisited their investment forays in destinations inside East Asia, where a Filipino executive described them as “trial and error, mostly errors,” hoping to inject life for travel and tourism into this sub-economic cooperation.

Executives of all airline companies in the Philippines and airlines in Indonesia and Malaysia attended the first Equator Asia Air Access Forum and Airline CEOs Summit held at the Marco Polo Hotel here, with upbeat forecast for increased air travel but with reservations on high airport charges, recurring hitches in airline operations that have left passengers grumbling over delayed and canceled flights, and high charges imposed by airlines.

Richard Miller, chief Group Aviation adviser to the chairman and chief executive officer of the Philippine Airlines (PAL), said their optimism includes the Brunei Darusallam, Indonesia, Malaysia, the Philippines-East Asean Growth Area (BIMP-Eaga) but even goes out wider in the Southeast Asian region.

But the upbeat note could be expedited “if airline companies could get a wide range of support from airport management and from the other destination ports, and marketing support from our respective governments.”

“We can look at the other areas, what worked well and what did not,” he said when asked to appraise prospects of air travel within the BIMP-Eaga.

“Let’s face it. It works that way. It’s a trial and error thing here when we open some destinations,” said Avelino Zapanta, president of the Southeast Airlines (Seair), recalling how airline companies in the four countries opened new routes only to fold up after a few months.

The executive of the Civil Aeronautics Board (CAB) said the government has required it to contribute to the generation of revenues and said this has limited its power to offer incentives to investors and conduct airport development.

Carmelo L. Arcilla, acting executive director of the CAB, admitted in the first Equator Asia Air Access Forum and Airline CEOs Summit held at the Marco Polo Hotel here, that the Department of Budget and Management has assigned the CAB to realize a target collection for the year.

“The DBM has set a target for us [to collect]. That’s the problem for us because [if we discard it] we would have problems with them the next time around,” Arcilla said, when asked if the Philippine aviation industry could offer incentives to new investors “similar to the three-year waive of taxes offered by Indonesia.”The problem has percolated down the industry as the proposal by local government and tourism agencies to have their own airport authority have not took off the ground.

Robert D. Waloni, director of the commercial and business development unit of the PT. Angkasa Pura 1 airport of Indonesia, said the effort of companies to liven up the travel industry within the BIMP-Eaga has been a steady desire of airline companies “which we still have to study.”

Carmelo L. Arcilla, acting executive director of the Philippine Civil Aeronautics Board (CAB), said the fate of the travel industry in the region “has been similar to the situation and issues that continued to hound the BIMP-Eaga long after it was established in 1994.”“It’s all about market forces to determine what destinations would be viable,” he said.

Jose Perpetuo Lotilla, undersecretary of the Philippine Department of Transportation and Telecommunications (DOTC), said airline companies and travel and tour operators “would try to share experiences and explore prospects for more vibrant activities for air travel and tourism in the BIMP-Eaga.”

“There would be no seeking of air travel rights and air agreements because these are being undertaken by governments. They’re here to exchange ideas and maybe, come up with a consensus on what’s the best approach to encourage more air travel,” he said.

Zapanta initially proposed in a news conference at the side of the Airline CEOs summit that airline companies and operators “should join together to put up one airline company to fly the high-profile and potentially profitable destinations.”“This way, the new airline company would have the benefit of assuming the air travel rights in the destinations,” he said.

Waloni said, however, that like what Encheon in South Korea and Dallas in Texas, US, had done, “other countries in the BIMP-Eaga should also study increasing the revenue activities in the airports, in the concept of a city airport.”“We have 15 or 16 international airports in the region, and the potential for tapping these ports are great,” he said.

In the South Korea and Texas experience of promoting a hive of business and commerce in the airport areas, “the airports have increased their non-aviation revenue to 60 percent as against the 40 percent they get from aviation sources.”

“By increasing the revenue of airports not from increasing their taxes from airlines, they could instead bring down the airport charges down to entice more airlines to operate,” Waloni said.

Lotilla said the Philippines was also studying the disclosure of Waloni, saying three of the Philippines’s 82 airports could be started to operate this concept. “As they say, it’s a mall with a runway at its side.”

Source - businessmirror.com.ph