'It will be possible this year. I am very optimistic, because this time both sides are very sincere,' said Chang Han-wen, a former president of the Taiwan Businessmen's Association in Dongguan.

'Moreover, this time the [Taiwanese opposition party] Kuomintang is participating in the negotiation ... they will be more flexible than the ruling party.'

Other businessmen reportedly share similar optimism.

Although Shenzhen was more convenient for Taiwanese businessmen in Guangdong - most of whom are in Dongguan and Huizhou - Mr Chang said charter flights should initially be launched from the provincial capital of Guangzhou, as well as Shanghai and Beijing.

'Initially, the only destination should be Taipei, because this simplifies things during the negotiations, given that time is short,' he said. Mr Chang said that if an agreement could be reached in the near future, demand would be heavy for the Lunar New Year period.

Otherwise, Taiwanese residents planning to visit the mainland during the holiday would book airline tickets via Hong Kong or Macau, he said.

In 2003, airlines were able to return passengers to Taipei from Shanghai, via Hong Kong.

While no such flights were allowed during last year's Lunar New Year period, a Taiwanese company received clearance to fly residents home for the presidential election in March with Air Macau.

But Tongying Resources executive director Chen Ming-chih said his firm lost tens of thousands of yuan on the venture and did not plan to arrange similar flights in the future.

'We made a lot of effort, but the authorities gave us approval too late, so many people had already booked to fly on other airlines,' he said.

'What is worse, they gave a very late flight time, so passengers arrived in Taipei in the middle of the night with no possibility of making connections back to their hometowns.'

The State Council's Taiwan Affairs Office said it would allow airlines from both sides to be involved in working out the details of charter flights.

It also encouraged the airlines involved to cover a greater number of destinations