The
US-UAE Open Skies Agreement is an agreement established by the United States
and the United Arab Emirates, allowing like the name suggests, open skies for
both parties. Each party grants the other party certain rights and rules to be
upheld while conducting their international air transportation, to include, but
not limited to:
a) “The
right to fly across its territory without landing;
b) The
right to make stops in its territory for non-traffic purposes;
c)
While entering, within, or leaving
the territory of one Party, its laws and regulations relating to the operation
and navigation of aircraft shall be complied with by the other Party's
airlines;
d)
While entering, within, or leaving
the territory of one Party, its laws and regulations relating to the admission
to or departure from its territory of passengers, crew or cargo on aircraft
(including regulations relating to entry, clearance, aviation security,
immigration, passports, customs and quarantine or, in the case of mail, postal
regulations) shall be complied with by, or on behalf of, such passengers, crew
or cargo of the other Party's airlines; and
e) The
rights otherwise specified in this Agreement” described in detail by the
Department of State (US Department of State, 2002).
Within
the parameters of the agreement, there is supposed to be little to no government
interference or regulation when it comes to commercial carriers. The idea is to
provide fair competition among the international carriers involved (US
Department of State, 2002). Long-haul carriers that are apart of this agreement
that also receive government subsidies include Qatar Airways, Emirates, and
Etihad Airways, who are in violation of the Open Skies Agreement by doing so (Correll, 2017).
American Airlines, Delta, and United Airlines have received government subsidies in the past, that dealt with guaranteed federal loans, and providing lower costs for equipment to in return reduce the amount of subsidy paid to certain air carriers (Schaal, 2015). Another complaint is that long-haul foreign carriers have made aircraft purchases at "below market interest rates" that are unavailable to US carriers. The Export-Import Bank offers below-market interest rates and allows foreign long-haul carriers to purchase aircraft from the US at a lower export rate (EXIM, 2016). When a US carrier goes to buy the same aircraft on US soil, they are subject to more fees and taxes. How can anyone think that is fair?
American Airlines, Delta, and United Airlines have received government subsidies in the past, that dealt with guaranteed federal loans, and providing lower costs for equipment to in return reduce the amount of subsidy paid to certain air carriers (Schaal, 2015). Another complaint is that long-haul foreign carriers have made aircraft purchases at "below market interest rates" that are unavailable to US carriers. The Export-Import Bank offers below-market interest rates and allows foreign long-haul carriers to purchase aircraft from the US at a lower export rate (EXIM, 2016). When a US carrier goes to buy the same aircraft on US soil, they are subject to more fees and taxes. How can anyone think that is fair?
The
US feels certain airlines, to include Norwegian International Airlines, Qatar, Abu
Dhabi, and Doha are undermining the United States carrier’s ability to
compete internationally. The UAE and Qatar have been given more than $50
billion in subsidies, since 2004, to run their state carriers, such as Qatar
Airways, Emirates, and Etihad Airways, which are in direct violation of the
Open Skies Agreement like I briefly mentioned above (Correll, 2017). There
seems to be much controversy regarding Norwegian International Airline’s current approval
to operate within the United States. Although they may bring more jobs for US
workers, US carriers like Delta and American Airlines, believe Norwegian
International is trying to bypass certain safety and labor laws by establishing
their headquarters out of Ireland (Jansen, 2016).
I
don’t
think it’s
fair for an international company to obtain an aircraft for cheaper, then
operate at the same cost or more, when those same options are not also provided
for US carriers. The playing field does not seem to be even or fair, and you
can argue that for stateside and international airliners. If the government wants
to be “fair,” they could
establish a pot of money and evenly distribute it to airline carriers… that’ll be the day.
References
US Department of State (2002, March
11). Air Transport Agreement Between The Government of The United States of
America and The Government of The United Arab Emirates. Retrieved from https://www.state.gov/documents/organization/125743.pdf
Schaal, D. (2015, April 09). WikiLeaks
Disclosure Shows US Airlines Received Billions in Subsidies. Retrieved from https://skift.com/2015/04/09/wikileaks-disclosure-shows-u-s-airlines-received-billions-in-subsidies/
EXIM (2016). Export Import Bank of
the United Statse. Retrieved from https://www.exim.gov/learning-resources/publications
Correll, S. (2017, December 5). US
Airlines at Odds Over Aviation Agreements with Qatar and UAE. Retrieved from https://www.washingtonexaminer.com/us-airlines-at-odds-over-aviation-agreements-with-qatar-and-uae
Jansen, B. (2016, December 2). DOT
Approves Contested Norwegian Air Flights. Retrieved from https://www.usatoday.com/story/travel/flights/todayinthesky/2016/12/02/dot-approves-contested-norwegian-air-flights/94838292/
It is interesting that the ‘open skies’ agreement states that there is supposed to be little to no government interference or regulation, but really. I think that that most governments want what is best for their countries. I have worked with government programs and they taught us that a lot of countries take information from us to help their country’s companies, allies like France and China are at the top of the list among others. So even if our country is trying to stay with the terms of the agreement, I do not think other countries are. At the end of the day, everyone wants to win and most people to what it takes to.
ReplyDeleteThis is what the airline industry has turned into, mergers and unfair competition. Emirates essentially wants to capitalize on the industry, they already have busses that shuttle people to the airport from downtown areas, they already have hotels in Dubai, and next they want to tackle the marketplace and ride sharing. Not only is this hurting global airlines, but global companies too.
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