New Open Skies Agreement for Canada - How will this benefit Toronto?

[ACT7]

Embassy, November 8th, 2006
NEWS STORY
By Lee Berthiaume

New Open Skies Policy Expected Next Month

Many countries hope Canada will include them in a new transportation policy that will create more direct flights, encouraging tourism and trade.
The government is expected to announce by Christmas a new policy on air travel that many hope will open up Canada's skies to foreign carriers, but which domestic carriers fear could severely damage the country's airline industry.

Stakeholders had until today to submit comments on a proposed open skies policy, which would lift restrictions for select countries and create direct flights between Canada and destinations like Jordan and Iceland.

An open skies policy would see Canada negotiate reciprocal agreements with other countries. The agreements would remove various restrictions, facilitate more direct flights with previously unserviced parts of the world, and allow airlines to land in Canada and continue onto other destinations.

Canada currently has open skies agreements with the United States and United Kingdom. At the same time, the U.S. has 77 agreements, New Zealand has 10, Singapore has nine, and even Chile has seven. The European Union has a complete open skies regime.

Iceland used to have direct flights to Halifax years ago, says Iceland's ambassador to Canada, Markus ?ñrn Antonsson, but the route proved uneconomical and was cancelled. Icelander airlines has expressed interest in restarting the route, but Air Canada has to give official notice it does not want to fly the route before the European airline can move forward.

"This lack of interest from Air Canada should not be the reason there are no connections," Mr. Antonsson says. "This is very inconvenient because there is no direct link; we have to go to the U.S."

Iceland put forward a proposal to the Canadian government in recent months, and while it has received approval to fly between Reykjavik and Halifax three times a week starting in May 2007, Mr. Antonsson says an open skies policy would hopefully lead to flight to other Canadian cities.

Not only would the move increase tourism and trade between the countries, Mr. Antonsson says, an open skies policy would help Iceland better position itself towards becoming a transport hub between North America and Europe.

"I think they have four or five draft proposals [from different countries] on the table." Mr. Antonsson says. "Iceland would be in that four or five. We expect things will start going ahead shortly after [today]."

Jordanian Ambassador Nabil Ali Barto says his country has also put forward a proposal, and while two flights per week between Amman and Montreal are scheduled to start next May, the large number of Canadians with links to the Middle East makes more direct flights extremely viable.

"We approached the government on this," he says. "We have a positive feeling on this. Such a policy will be beneficial to both countries' tourism and trade."


Not Every Country Will Be Included

Transport Canada spokeswoman Lucie Vignola says the consultation that ends today is gauging immediate thoughts on an open skies policy and more consultations will be conducted after. "I would be expecting an announcement around Christmas."

While Ms. Vignola would not comment on what specific country proposals are being considered, news reports indicate that in addition to Iceland and Jordan, Panama, Australia, Germany and Singapore have also expressed interest.

But Ms. Vignola warns that not every country will be included.

"We will do it where it makes sense," she says.

Jim Facette, president and CEO of the Canadian Airports Council, which has been actively pushing for such a policy, said in a statement that open skies would only help Canada's airports and the communities they serve.

"We look forward to implementation of a policy that will facilitate a more competitive Canada, resulting in economic benefits for the communities airports service," he said.

"Canadian airports are busy actively marketing their communities to air carriers of the world, and what we have asked for is an international air policy framework for Canada that allows these communities to compete fairly and take advantage of the opportunities available."

But along with the high hopes have come some warnings from some parts of the Canadian airline industry.

Fred Gaspar, vice-president of policy and strategic planning at the Air Transport Association of Canada, says the Canadian industry is at a severe disadvantage with carriers in other countries and opening up the skies could cause irreparable damage.

"The Canadian industry does not shy away from competition," he says. "The problem is, we're not cost competitive."

Excessive taxes on gas, airport rental fees and the air traveler security charge, which Mr. Gaspar says is one of the highest in the world, have all contributed to a weak airline industry in Canada and opening up the country's skies will only wreck havoc on the industry.

Changing some of those things, which Mr. Gaspar says the government has indicated it might, would be a step in the right direction. Otherwise, "we think it would be quite damaging to Canada's economy."

lee@embassymag.ca

[nitzomoe]

c'mon dubai

[ACT7]

Originally Posted by nitzomoe

c'mon dubai

That's what I'm talkin' 'bout!!

[samsonyuen]

Why would Icelandair fly to Halifax and not a larger city, like Toronto or Montreal?

[nitzomoe]

obviously theres a lot of Nova Scotians who love iceland!

[Filip]

Yep.. shopping in Reykjavik (or whoever the hell you spell it)!