Friday, March 11, 2005

Budget airline dispute shaping up between Indonesia and Singapore 

I have mentioned previously the delay that Indonesian budget carrier AWAIR is facing in getting approval from the Civil Aviation Authority of Singapore for its flight to Singapore (see “Budget airline may sue Singapore”), and the lack of explanation from the latter. Well, the CAAS has finally spoken.

New Indonesian restriction stops AWAIR’s flight to Singapore
There has been a new twist to the AWAIR saga. In a statement on Thursday, the Civil Aviation Authority of Singapore (CAAS) said it was unable to proceed with AWAIR’s application to fly to Singapore because... Indonesian authorities intended to introduce a new restriction on services by low-cost carriers to and from certain points in Indonesia...
The Straits Times reports that the Indonesians are unhappy with this linkage.

When contacted in Jakarta, director for air transport in the Transportation Ministry, Mr Eddy Santoso, said he was baffled by Singapore’s attempt to link Awair’s application with the talks on Singapore-based carriers... “[T]his was never in the talks with Singapore,” he said, adding Indonesia’s airlines are already far behind in the competition...

In a statement, Mr Sendjaja Widjaja, president director of [Awair]...said that the carrier was “very disappointed” with CAAS for “dragging its feet”... “CAAS should not have used Awair as a bargaining chip...” he said.
To the Indonesians, I would say that tit-for-tat is just par for the course when it comes to protectionism.

To Singapore, this should be a reminder that when you make a living off others, a conspicuous advantage tends to invite a backlash from the latter, even when the advantage is gained in fair competition.


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