AIR Hong Kong, the all-cargo airline which came close to going out of business 12 months ago, is continuing its remarkable recovery. Three weeks ago it started its first transpacific service to Chicago and New York. Business is so good, says Air Hong Kong president Captain Pran Parashar, the man who rescued the airline from the brink, that an extra weekly flight was added from last week. Its flights to Europe also have been increased during the present peak season from five times a week to a daily service. To cope with the expanding business, a Boeing 747-200 freighter will replace one of Air Hong Kong's three 747-100s in mid-November and a second 747-200 will be added to the fleet in the first quarter of next year. Capt Parashar says business has been much better than expected on its transpacific service in which Air Hong Kong is involved with Tower Air in a code-sharing arrangement. Although the airline is designated for five destinations in the US, they do not include Chicago or New York. To get round this, Air Hong Kong shares the service with Tower Air using the US airline's flight number. ''It is a very good arrangement,'' said Capt Parashar. ''I pay them a lump sum for the round trip. ''We are averaging over 90 per cent loads out of Hong Kong and around 55 per cent inbound. We are making quite a bit of money.'' Air Hong Kong is also designated to fly to Pusan in South Korea and hopes to start a service, but the Korean military has blocked the plans. ''We have been told the airport is under renovation and will not be ready until 1997,'' said Capt Parashar. Air Hong Kong is now seeking a temporary permit to fly to Seoul, having already won the approval of Korean authorities. However, the Civil Aviation Authority in Hong Kong has said it needs further negotiations with Korea before giving approval. In another development, Air Hong Kong has won approval from the Taiwanese Government for a joint-venture service with EVA Air, but before it starts it must gain a licence from the Hong Kong Air Transport Licensing Authority (ATLA). That could prove a hurdle as Capt Parashar said Cathay Pacific had objected to the plan. The hearing is set for next month. * * * THE region's first intra-Asian air-express cargo service, Pacific East Asia Cargo (PEAC), has ''not missed a beat'' and is looking to include Hong Kong in its network during the winter schedule. The service, based in Manila and flying daily between Singapore, Brunei, Manila and Taipei, is averaging loads of between six and seven tonnes on the BAe 146 aircraft which have a maximum load of 10 tonnes. ''From an aviation point of view, a start up of this kind can be snookered in all sorts of ways for all sorts of reasons,'' said Bill Burgess, president of TNT Asia which has a 20 per cent stake in PEAC. ''But this service has gone extraordinarily well. Technically the service has been 99.9 per cent efficient, we have added an extra two pilots, making a total of 14, and we are now looking for extra aircraft for when we extend the network.'' The choice of aircraft to add to the fleet was likely to be a Boeing 727 or 737, said Mr Burgess. * * * PHILIPPINE Airlines (PAL) plans to upgrade its services in a big way - and to rid itself of its notoriously bad on-time record. PAL president and chairman Carlos Dominguez has said he wants PAL to move into the next century as a world-class enterprise. To achieve this, PAL is expanding its international and domestic fleet, improving its infrastructure and upgrading customer service at airports in the Philippines, - introducing staff incentive schemes to improve efficiency. Mr Dominguez said he wanted to rid the airline of its reputation of being a poor timekeeper. Among the customer services which the airline has introduced is a hospitality lounge at Ninoy Aquino International Airport in Manila for overseas workers and their families.