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UK minister cites PAL's Airbus purchase in new PH-UK air deal

TRADE RELATIONS. UK Member of Parliament Hugo Swire announces the new air services agreement between the Philippines and the United Kingdom. Photo by Carlos Santamaria

TRADE RELATIONS. UK Member of Parliament Hugo Swire announces the new air services agreement between the Philippines and the United Kingdom.

Photo by Carlos Santamaria

MANILA, Philippines - Visiting United Kingdom Member of Parliament (MP) Hugo Swire announced that a new bilateral air service agreement between his government and the Philippines' has been sealed on Tuesday, December 11.  

In a speech before business leaders in Makati City, Swire, also the Foreign Minister of State at the UK Foreign Office, made special mention of the recent purchase of new Airbus aircraft by local legacy carrier, Philippine Airlines (PAL).   

"I [have signed] a new air services agreement with [Transportation] Secretary [Joseph Emilio] Abaya and will meet Ramon Ang [President and Chief Operating Officer] of PAL who hope to start direct flights to London soon," Swire told members of the Makati Business Club and the Management Association of the Philippines.

"Incidentally, their (PAL) passengers will probably be arriving on new aircraft made partly in Britain, following the announcement by PAL in August of a US$7 billion order from Airbus for over 50 new aircraft," he added. 

In August, PAL announced an order for 54 wide and narrow-bodied Airbus aircraft with a list price of $7 billion, the biggest airline deal in the country. At the time, PAL announced that, of the 54, it will purchase 10 A330-300 twin-aisle jets

The large number of long-haul aircraft orders by PAL has set the world's two major manufacturers -- Boeing and Airbus -- scrambling for a piece of it.  

Airbus -- originally a consortium between France, Germany, Britain and Spain -- is pushing for major contracts in Asia. Both aircraft makers are locked in a global contest for market share, with top-level officials and diplomats giving support during trips to Asia.

During the October visit of French Prime Minister Jean-Marc Ayrault in Manila, he hinted that PAL has confirmed an order for 10 Airbus A330 jets on top of a purchase in the summer.

Swire is in a 2-day Manila visit from December 11 to 12. He is responsible for British relations with the Philippines and South East Asia. 

Aside from his meeting with Abaya, Swire will also meet with President Aquino in Malacañang, Foreign Affairs Secretary Albert del Rosario, and Interior Secretary Mar Roxas. The main focus of his visit is boosting bilateral trade and investment relations with the Philippines.

PAL, now controlled by diversified conglomerate San Miguel Corp, has an ongoing multi-year refleeting and modernization plan, which involves the purchase of up to 100 new planes.

The airline wants to fly long-haul to profitable destinations, including the United States where it is barred to expand its current operations, and to the European Union, where the Philippines remains in the blacklist due to pending issues on the ability of the aviation regulatory body to implement global safety standards.

PAL has been sealing and seeking deals with other carriers that do not have limited access to these markets.

Carmelo Arcilla, the executive director of Civil Aeronautics Board (CAB), which is part of the Philippine panel that negotiates air services agreements with other countries, said the Philippines and UK have tried to finalize a new air deal in 2009 to update the 1965 one, but no pact was sealed.

“It’s a comprehensive agreement that defines the aviation relationship of two parties. In 2009, there was an agreement but was not signed,” he stressed.

Arcilla said the details of the agreement including flight frequencies between the two countries would be finalized soon. - Rappler.com, with reports from Carlos Santamaria