HK opens links to Luxembourg

PUBLISHED : Saturday, 09 April, 2005, 12:00am
UPDATED : Saturday, 09 April, 2005, 12:00am

The government signed a new air services agreement with Luxembourg yesterday lifting all restrictions on point-to-point travel and trade transport between the countries, helping Hong Kong's airport secure its position as the region's premier cargo hub.

The agreement, which in the absence of a Hong Kong airline in the sector is expected to largely benefit the Grand Duchy's flag carrier Cargolux, also expands by 70 per cent the number of beyond destinations carriers can operate - to 29 for each side.

'This deal will maintain Hong Kong's strong development as a cargo hub,' said Wilson Fung Wing-yip, deputy secretary for economic development and a key negotiator. 'Despite the fact that Hong Kong airlines offer no services to Luxembourg, we decided it was in both parties' best interests to grant Cargolux, which has long been committed to Hong Kong, the flexibility to continue to develop its network here.'

The previous agreement had limited direct flights between the countries at 10 per week and beyond destinations - known as fifth-freedom rights - at 17.

Under the limits of the former regime, Cargolux had been struggling to post substantial growth levels of the cargo it carried through Hong Kong.

The airline, which utilises only 100-tonne capacity Boeing freighter aircraft, moved a little less than 19,700 tonnes of cargo through the airport last year, up 2 per cent from the previous year.

Asian exports outweighed imports by a ratio of 12 to one last year, making fifth-freedom rights vital to the profitability of any carrier plying the route.

'We are very pleased with the support the Hong Kong government has afforded us. Cargolux's development in Hong Kong historically has been very positive and this is another big step forward,' said Robert van de Weg, senior vice-president sales and marketing, from the airline's European headquarters. 'Next to Luxembourg, Hong Kong is our biggest hub.'

The government is also in the process of negotiating a deal with Bahrain. Mr Fung said a conclusion to those talks can be expected early next week.