Airlines allowed unlimited flights between the two cities TRAVEL BETWEEN Hong Kong and the Gulf is expected to increase following the signing of a memorandum of understanding between Bahrain and Hong Kong. The agreement allows Gulf Air and Cathay Pacific to operate an unlimited number of flights between the two regions. Gulf Air currently operates flights daily, with a stop in Bangkok. Cathay Pacific operates nine flights a week on the route. 'This is a very important development as this air link plays an important role in bringing the two nations together,' said Ahmed Ali, director of air transport and civil aviation in the Ministry of Transportation. 'Hong Kong is an important business hub in this part of the world, and Bahrain is a business centre for the entire Middle East.' Bahrain International Airport is one of the Gulf region's leading air hubs, serving 40 commercial airlines. It is also home to Gulf Air. 'We anticipate an increase in passenger traffic, especially with the opening of Hong Kong's Disneyland in September,' Mr Ali said. Bahrain is an archipelago of 33 islands in a bay between Qatar and Saudi Arabia. Nearly a quarter of the population of 650,000 people live in the capital of Manama. Foreign nationals account for 40 per cent of the population. The country's key exports include petroleum, aluminium and services. Asia is its most important export destination. It imports crude oil and all non-oil commodities. Saudi Arabia is by far its most import source of imports, accounting for 30.7 per cent. The United States follows with 11.4 per cent. Japan, Britain and Germany are other key import partners. 'Over the past decades, Gulf Air has proved to be the vehicle linking the people of Hong Kong and the Kingdom of Bahrain,' said Dr Y.C. Chow, honorary consul of Bahrain and promoter of the Hong Kong Bahrain Business Association. 'Bahrain has long been a favourite regional destination for both leisure and business travel.' Tourism is expected to play an increasingly important role in the country's economy in the years to come. 'The kingdom is developing its strategy to attract a variety of visitors, and major tourism development projects are under way to cater for different needs in the areas of business, sports, health and family tourism,' Dr Chow said. In addition to Bahrain, Gulf Air is the national carrier of two other countries: the United Arab Emirates and the Sultanate of Oman. The three states are the airline's sole shareholders. However, Gulf Air president James Hogan said the airline was considering privatisation 'off the back of the strong results we posted for 2004 ... especially to generate the capital required to re-equip the airline'. 'We have been in discussion with interested parties in this regard,' he said. With a population of more than 4 million people, the United Arab Emirates is Hong Kong's most important trading partner in the Middle East and its 18th most important export market worldwide. It is the city's 20th largest source of imports. Hong Kong's major exports to the Emirates include clothing, telecommunications equipment, watches and clocks, parts and accessories of office machines and computers, audio and video recorders and players, and precious and semiprecious stones. Hong Kong's major imports from the Emirates include engines and motors and their parts, pearls and semiprecious stones, telecommunications equipment and parts, glassware, petroleum oils (other than crude), cars, watches and clocks, motor vehicle parts and accessories, and jewellery. Hong Kong's exports to the Emirates increased by 4.2per cent year on year in 2003, according to the Hong Kong Trade Development Council. The city's re-exports to the Emirates increased by 3.8 per cent, with domestic exports rising by 26.4 per cent. Of Hong Kong's top 10 exports to the Emirates in the first seven months of last year, six recorded positive growth. Clothing and clothing accessories were up 42.5 per cent, telecommunications equipment and parts rose 8.5 per cent and watches and clocks climbed 4 per cent. Audio and video recorders and players climbed 36 per cent, toys, games and sporting goods were up 28.3 per cent and jewellery rose 32 per cent. Four export items registered declines. Engines, motors and parts were down 6.3 per cent, parts and accessories for office machines and computers dropped 6.5 per cent, precious and semiprecious stones fell 41.7 per cent and radios declined 25.9 per cent. Bordering the Arabian Sea, the Gulf of Oman and the Persian Gulf, Oman is located between Yemen and the United Arab Emirates. It has a population of more than 2.9 million people, of whom 577,000 are expatriates. It has large oil and gas reserves, a substantial trade surplus and low inflation. Key exports include petroleum, re-exports, fish, metals and textiles. South Korea and China are its key export markets, each accounting for nearly 19 per cent. Japan follows with 16.2 per cent and Thailand with 12.2 per cent. Other key export markets are the United Arab Emirates and Iran. The sultanate imports machinery and transport equipment, manufactured goods, food, livestock and lubricants from the United Arab Emirates, Japan, the United States, Britain, Germany and India.