Private airlines yet to prove feasible
As many as six applications to establish private airlines have been lodged with the Civil Aviation Authority of Vietnam (CAAV), Saigon Air being the most recent.
Nguyen Tien Sam, Deputy Minister of Transport and CAAV Director General, said that the civil air services are technically open to any provider meeting regulations.
CAAV is proposing that the Government found several more airlines, he said. Singapore has four air carriers, Thailand has 10, while the Philippines have nine; so given Vietnam’s market and population, five or six would be operable.
Nevertheless, Mr Sam stressed that mandatory requirements must be met for provision of airline services. Hence, five applications have already been rejected after proving unfeasible. The Prime Minister has approved one application, but it currently has no investor interest.
Mr Sam revealed that CAAV received the Saigon Air Service Joint Stock Company (Saigon Air) application in January. Once founded, the company will have chartered capital of VND300bil.
Saigon Air plans to operate both local and international flights. In the first phase of operation, it will focus on goods transportation and passenger flights on demand instead of offering routine flights.
While looking good on paper, the plan has not been enacted since its lodging five months ago, as the founders cannot prove their financial capability.
Meanwhile, head of the Saigon Air Committee for Establishment Campaigning Doan Van Quang emphasised that the committee should be able to mobilise capital once the project is approved.
Mr Quang also said that Saigon Air could be operational just one year after its founding date.
Mr Quang was behind a purchase bid for Pacific Airlines when it was on the verge of bankruptcy last year. His proposal was not accepted.
Meanwhile, experts have urged the Government to apply suitable policies, paving the way for private aviation services. Privatisation of aviation will require action, not just idle talk, they said.
Vietnam Economic Times - June 01, 2005.
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