Airports Say Competitiveness Panel Recommendations a Good Approach for Canada’s Aviation Sector

Thursday, June 26, 2008 -

Airports Say Competitiveness Panel Recommendations a Good Approach for Canada’s Aviation Sector

OTTAWA (June 26, 2008) – The Canadian Airports Today said several recommendations in the federal government’s Compete to Win report represent a good approach for improving the competitiveness of Canada’s aviation sector.  The group, which serves as the voice of Canada’s airports, says it supports recommendations on industry costs, Open Skies and airline foreign investment.

“For several years now, the CAC has called on the federal government to adopt a new approach for aviation that recognises the value this sector brings to Canada’s economic future,” said CAC President and CEO Jim Facette.  “The Competition Policy Review Panel recognises this value, and we urge the government to carefully consider its recommendations.

Among the recommendations in Compete to Win were:

• Noting industry concerns about government policies that have negatively impacted industry costs, a recommendation that fiscal arrangements affecting the competitiveness of the industry be reviewed on a regular basis.
• Citing the potential for Canada to be at a competitive disadvantage to the U.S., which has a more aggressive air service liberalization policy, that Canada conclude an Open Skies agreement with the European Union as soon as possible.
• That the Minister of Transport raise foreign ownership limits on Canadian air carriers to 49 per cent on a reciprocal bilateral basis and state its policy on whether 100% foreign ownership of Canadian air carrier subsidiaries should be permitted.

“`In practice, Canadian international air policy is still relatively restrictive…’  These are the words of the Competition Policy Review Panel, and we agree,” said Mr. Facette.  “We also agree that the Canadian industry currently is at a competitive disadvantage to the U.S. because of the U.S.-EU agreement and that successfully completing Canadian negotiations with the EU on a Canada-EU Open Skies agreement ‘has economic importance for the nation.’”

The CAC notes that the EU is only part of the story, however.  The U.S. has 92 Open Skies agreements.  Canada has only five.  There are other important markets with which Canada has very restrictive agreements and several recent agreements negotiated have been far less than Open Skies.  The CAC also has requested to participate as observers in talks, as the air carriers do and airports in other countries do.  This would allow community interests to be represented and better enable airports to understand the dynamics of what is going on in individual markets.

About the Canadian Airports Council

The Canadian Airports Council (CAC) is the voice for Canada’s airports.  Its 49 members represent more than 180 airports, including all of the National Airports System (NAS) airports and most significant municipal airports in every province and territory. Together, CAC members handle virtually all of the nation’s air cargo and international passenger traffic and 95% of domestic passenger traffic.  They create in excess of $45 billion in economic activity in the communities they serve.  And more than 200,000 jobs are directly associated with CAC member airports, generating a payroll of more than $8 billion annually.