Tags: China | Coronavirus | Financial Markets | Trump Administration | airlines | flights | trade war

US Limits China's Airlines to 2 Weekly Flights Amid Trade Spat

chinese president xi jinping and president donald trump walk off the red carpet before a summit
Chinese President Xi Jinping and President Donald Trump (Andy Wong/AP)

Friday, 05 June 2020 07:53 PM

The Trump administration, in the latest move ratcheting up tensions in U.S.-China trade, said Friday the nation had continued to violate airlines' rights by restricting flights and ordered new limits on its carriers.

Responding to a move by China on Thursday to limit U.S. passenger airlines to one flight per week each, the U.S. Department of Transportation said it would only permit two flights a week in total from Chinese airlines.

The latest action would reduce by half the number of operations to and from the U.S. by the four Chinese carriers that had continued those routes after severe schedule reductions due to the COVID-19 outbreak, according to the agency's order.

The Transportation Department found the Civil Aviation Authority of China "continues to preclude U.S. carriers from fully exercising their rights" under an agreement guaranteeing flight access signed by the two nations.

"We find that these circumstances continue to warrant the department's action to restore a competitive balance and fair and equal opportunity among U.S. and Chinese air carriers in the scheduled passenger service marketplace," the agency said in the order.

The action is the latest in a series of moves between the two nations over trade, the coronavirus pandemic and the treatment of Hong Kong. China recently paused some agriculture imports after President Donald Trump threatened steps against Hong Kong. A phase one trade deal between the nations is in jeopardy, along with billions of dollars in Boeing Co. aircraft sales.

China's embassy in Washington did not immediately respond to a request for comment.

Airlines for America, a trade group for large carriers, did not comment on the specifics of Friday's order. The group said it was "committed to ensuring U.S. carriers have fair and equal opportunity to access the Chinese market."

The U.S. on Wednesday had issued an order that would have banned all flights from Chinese carriers if that nation did not agree to allow U.S. airlines to resume flights there. United Airlines Holdings Inc., Delta Air Lines Inc., and American Airlines Group Inc. all stopped flying to China in February as the pandemic erupted.

However, that order would have permitted one Chinese-airline flight for each one that nation granted to U.S. carriers.

While the latest U.S. government order contains sharp criticism of China, its impact is effectively the same as the one issued Wednesday. With Delta and United seeking to restore service to China this month and being limited to one flight per week, the previous order would have imposed a similar cap of two weekly flights.

Onerous Rules

The various restrictions outlined by China on Thursday for a resumption of flights by U.S. companies are onerous.

China said it would test all arriving passengers for COVID-19 and, if 10 or more test positive, the route will be halted for four weeks. In addition, provincial authorities would also have some authority over flight approval.

Carriers would like to see the U.S. government do more to ensure fairness, said the person, who asked not to be named while discussing sensitive diplomatic talks.

The Transportation Department also raised concerns about the conditions imposed by China.

The agency said its "overriding goal is not the perpetuation of this situation." It said the department is prepared to revisit the restrictions should China improve the environment for U.S. airlines.

© Copyright 2021 Bloomberg News. All rights reserved.

The Trump administration, in the latest move ratcheting up tensions in U.S.-China trade, said Friday the nation had continued to violate airlines' rights by restricting flights and ordered new limits on its carriers.
airlines, flights, trade war, tariffs, pandemic, covid-19
Friday, 05 June 2020 07:53 PM
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