‘EO 29 unfair to PHL carriers’

Business Mirror
Sunday, 27 March 2011 20:01  Recto Mercene

THE newly issued Executive Order (EO) 29 that granted unprecedented fifth freedom rights to foreign airlines without assurance that Philippine carriers will get the same reciprocal arrangement put local carriers, like Cebu Pacific and Philippine Airlines (PAL), at great disadvantage.

This was that statement of Fair Trade Alliance (FTA) convener Robert Lim Joseph, a travel and tourism industry leader, as he called on President Aquino to review EO 29 allowing pocket open skies and amend its disadvantageous provisions.

Fifth freedom is the right of an airline from one country to land in a second country, then pick up passengers and fly on to a third country where the passengers then disembark.

Joseph said in a fifth freedom environment, a foreign carrier like Singapore Airlines can fly, say, to the Diosdado Macapagal International Airport (DMIA) in Clark Fiel, Pampanga, pick up passengers there and then fly them to Los Angeles, California.

Joseph raised suspicion that lobby groups like the Makati Business Club and the Freedom to Fly Coalition, which have been pushing for unilateral and one-sided open skies, were behind the issuance of the questioned executive order.

“The Philippines can no longer get reciprocal arrangements or equal benefits from foreign governments because we have already given our skies for free. Our air negotiating panel has no more bargaining power to begin with,” Joseph stressed.

He said the EO unilaterally granted “fifth freedom rights and unrestricted capacities and frequencies to foreign air carriers” with no reciprocity to local airlines.

“This is a lopsided grant given to foreign airlines, which is detrimental to the growth of Philippine carriers,” Joseph pointed out.

“Where is the merit of government’s claim that the EO will bring in tourists when the fifth freedom privilege will instead allow foreign airlines to pick up Filipino and local residents and fly passengers out to a third country?” he asked.

Joseph also questioned government assertion that the EO will enhance the competitiveness of local carriers. “How will you enhance their competitiveness when, in fact, the EO greatly weakened their capability to compete and could even result in bankruptcies.”

“And if our local airlines go bankrupt because of the unfair and uneven playing field, what employment can you generate?” Joseph asked, as he questioned the basis for the investment and job prediction contained in the EO.

He said foreign governments do not unilaterally grant fifth freedom privileges as these are granted only within bilateral discussions with the applicant nation.