New aviation sector awaits competition By Guo Zi (China Daily) Updated: 2004-07-10 09:04
Management of the four airports in Northwest China's Gansu Province was
finally handed over to the local government on Thursday.
By doing this, the General Administration of Civil Aviation of China (CAAC)
lowered the curtain after 28 months of reform of the aviation sector.
So far, the former nine aviation companies and four service companies have
been regrouped into six group enterprises. Except the airports in Beijing and
Tibet,90 airports previously controlled by the CAAC have been handed over to
local governments.
The CAAC is no longer taking care of the enterprises' profits and losses and
now concentrates on general market regulation, security supervision and air
traffic management, as well as public relations.
Then what has the reform brought for the general public, for whom ticket
price and service quality are the major concerns?
A regulation on the pricing of flight tickets took effect on April 20,
allowing greater fluctuations in pricing depending on market demand. Another
equally welcome step - a "Punctuality Plan" - was launched at the same time.
Both show that industrial authorities have reacted positively to rising consumer
complaints about fixed ticket prices and calls for better service.
The market is now playing a much bigger role in the once highly monopolized
aviation sector.
Competition has injected vigour into the sector and the reform seems to
produce an inspiring result. According to the latest CAAC statistics, during the
first five months of the year, the civil aviation sector saw a total turnover of
58.86 billion yuan (US$7.1 billion) with a profit of 4.63 billion (US$559
million), which is said to be the sector's first large-scale profit gains in
recent years.
But time is still needed to test the overall effects of the reforms. And
further improvements should be made.
The CAAC should urge airlines to make out their detailed criteria for
distinguishing human from non-human factors as well as compensation standards
under the "Punctuality Plan."
The package of reforms has come to a conclusion but the work to win out in
the market should never end.
