RP-US AIR TALKS FACE COLLAPSE

Manila, July 6, 2003 By FRANCIS EARL CUETO (MALAYA) A transport official yesterday said air service negotiations with the United States will surely collapse if Washington insists on allowing third country airlines to share in the US-Philippine passenger traffic.

The official, who asked he not be named, said the Philippine panel is prepared to bend over backward on the issue of open skies for passengers and cargo, but not on "third-country code."

Under the proposed third country code arrangement, US airlines will be allowed to drop Manila-bound passengers in, say, Tokyo, Seoul or Singapore and have other airlines carry them to their final destination. The arrangement is also good for US-bound passengers from Manila.

"Third country code is non-negotiable," the official said. "It will kill our airlines."

Air negotiations are scheduled to resume the third week of this month. A breakdown in negotiations will lead to either the full implementation of the frozen 10-year-old RP-US Air Service Agreement or its total scrapping.

The official said open skies on passenger traffic is already harmful to local carriers. But at least, he said, carriage to and from Manila will be limited to US airlines.

If the privilege is granted to Japanese, Korean and Singapore carriers through the convenience of "third country code," the official said, there will be no passengers left to local carriers.


Reported by: Sol Jose Vanzi

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