Now that the war games and elections are over, officials on both sides of the Taiwan Strait are waving olive branches, and ironically the chances look better than ever that the 'two Chinas' could agree on direct flights.

The pressure on Taiwan for direct flights is growing. Newly re-elected Taiwanese President Lee Teng-hui feels a need for reconciliation with China and some demonstration of Taiwan's interest in ultimate reunification with China. There is serious talk in Taipei that he may offer some bold rapprochement to Beijing that includes direct flights.

Two days after the election, the economic affairs ministry recommended a feasibility study on direct transport links. The economics minister has also announced plans to license special districts for direct trade with China. Cross-strait telephone links could come even sooner.

Taipei also realises that events are quickly overtaking it. Within the past five months it has agreed to 'same-aircraft' connections to China via Macau or Hong Kong. And less than three months ago, it allowed China Airlines to seal an interline agreement with three Chinese carriers. Taipei is now processing a request from Air Macau, 51 per cent controlled by China National Aviation Corp, the commercial arm of Beijing's CAAC, to open a Taipei branch office. All these steps compromise Taiwan's ideological opposition to direct flights.

Taipei officials are also aware of the delay by Hong Kong's Sino-British joint liaison group in approving Taiwan's new air accord with Hong Kong, and reports of a Beijing power struggle over CNAC's desire to replace Dragonair as the second Hong Kong carrier on that route (see page 21). If a Hong Kong-based Chinese airline can fly to Taiwan, Taipei officials know they will have little grounds left for sustaining a ban on direct flights. They also know Hong Kong flights themselves will become 'direct' after the territory's handover next year. There is a growing view that Taipei should negotiate the best deal it can while it still has some leverage.

Nicholas V Chen, a lawyer at Perkins Coie-Taipei, claims Taiwan's consumers and business community both favour direct flights. The lack of them, says Chen, 'continues to be a barrier to Taiwan becoming a regional centre and is a growing source of impatience.' Without prompt action he and others fear direct flights will become a political football again with officials more interested in scoring points than resolving anything.

David Knibb

Source: Airline Business