ATLA to grant Cathay Pacific licences to operate scheduled services to Beijing, Shanghai and Xiamen

Cathay Pacific Airways today welcomed a decision by the Air Transport Licensing Authority (ATLA) in Hong Kong to grant the airline licences to fly  to three destinations in the Chinese Mainland, namely Beijing, Shanghai and Xiamen.

ATLA has granted licences which will enable Cathay Pacific to fly three times a day to Beijing, three times a day to Shanghai and three times a week to Xiamen.

This is the first step in Cathay Pacific's bid to resume flights to the Mainland - something that the airline says will be in the interest of both China and Hong Kong. The airline believes that commencing its own services to these three cities will have a positive effect on Hong Kong's role as an aviation hub and restore Hong Kong's competitive footing in the region.

Cathay Pacific Director & Chief Operating Officer Philip Chen said: "We are very pleased that ATLA has approved licences for Cathay Pacific to fly to Beijing, Shanghai and Xiamen. Not only will it be a boost for Hong Kong's  status as an aviation hub, it will bring many more passengers throug  Hong Kong and boost the local economy, and also promote tourism in the Chinese Mainland."

Dragonair however expressed its deep disappointment at the decision.

"We are disappointed with the decision for several reasons," said Dragonair Chief Executive Officer Stanley Hui. "First, we believe it contravenes the Basic Law in respect of China's domestic routes. And second, the decision will result in uneconomic overlapping with the services provided by Dragonair on the three routes, leading to financial devastation for Dragonair. We made a very strong case as to the economic impact that granting the licences would have on Dragonair.

"The current impact of SARS on Dragonair's operation clearly demonstrates that a drastic deterioration to the markets of Beijing,  Shanghai and Xiamen will lead to financial devastation for Dragonair, and the collapse of our network to secondary China Mainland cities."

Mr Hui added: "We feel the decision is unfair to Dragonair. We will now review with our legal representatives the options open to us with regard to today's ruling."