Beijing's sovereignty claims over the 'territories' of Hong Kong and Taiwan are having repercussions throughout Asia and could yet spread to other parts of the world.
China's attempts to disrupt Taiwan's presidential election in March have left the status of air services between several Asian points in limbo. Chief among these is Hong Kong, where the Hong Kong-Taiwan air accord signed in mid-December still awaits approval. The Joint Liaison Group responsible for Hong Kong's transition to Chinese rule has approved a number of Hong Kong bilaterals, but is sitting on the Taiwan agreement. Cathay Pacific and China Airlines are renewing their current agreement on a month to month basis and new entrants Dragonair and EVA Air must wait until the new accord takes effect.
One of two likely reasons for the delay is that China National Aviation Corporation has not yet settled its Hong Kong strategy. CNAC remains coy about whether it will press ahead with its operating licence request or simply buy a stake in Dragonair. The other explanation is that China has told its JLG members to stall on the air accord to keep the pressure on in the lead-up to Taiwan's elections.
An agreement between South Korea and Taiwan to revive air links faces similar obstacles. Under pressure from its airlines, Seoul has retreated on points that had stalled talks with Taipei, but is delaying any agreement because of concern over Beijing's reaction. Taiwan cancelled air services with Korea in 1992 when Seoul switched diplomatic recognition to Beijing. The switch helped Korea open trade and new air routes to China, but KAL and Asiana claim those routes could be more profitable if Taiwanese could fly to China via Seoul rather than Hong Kong. Taiwanese business travel to north China is growing with a shift in Taiwanese investment, thus making Seoul an attractive gateway.
The fallout over China is also giving Cathay Pacific a head- ache in Korea. The carrier is attempting to quell unrest among 90 of its 150 South Korean employees. They walked out in January seeking assurances of compensation in the event the airline is nationalised after China takes over Hong Kong - the first industrial action taken by employees over the transfer.
Negotiations on a new bilateral between Hong Kong and the Philippines are in limbo after Manila demanded a revision to capacity limits initially agreed last August. The delay could make any eventual agreement worthless because the new treaty might not gain JLG approval before the 1 July 1997 handover. Beijing will only recognise a bilateral with JLG approval and this can take up to a year.
And the prospect of Chinese territorial claims affecting aviation beyond Asia is highlighted by a recent settlement between UK and Chinese negotiators. For 12 years, Beijing has argued that the UK should disclose confidential addenda to Hong Kong's bilaterals negotiated by London, especially those concerning European carriers' rights on the Hong Kong-Taiwan sector. The UK steadfastly refused but has now agreed that Beijing may review these addenda after 1 July, 1997.
The settlement of this thorny issue attempts to limit Beijing's right to revoke those fifth freedoms, but the language on that point is vague. With China still seeking to restrict Taiwan's contacts with the rest of the world, those air rights could be in jeopardy.
D Knibb/T Ballantyne
Source: Airline Business
