Taiwan, China airlines team up on lucrative routes

TAIPEI (AFP) - Four major Taiwanese and Chinese airlines teamed up on Thursday to strengthen their services on lucrative routes carrying passengers between the former Cold War foes.

The alliance between Taiwan's top carrier China Airlines and its mainland counterparts China Southern, China Eastern and Xiamen Airlines was aimed mainly at frequent flyers, an important segment amid growing business ties.

The four carriers account for 270 weekly flights between China and Taiwan, or about half of the total market, the companies said in a statement.

"We believe the alliance should help China Airlines gain a competitive advantage over the long term," said Corinne Jian, an aviation analyst at Macquarie Capital Securities.

Under the new partnership, travellers that hold frequent flyer cards with any of the four airlines will in future be able to enjoy privileges with all of them, the companies said.

The privileges include redemption of frequent flyer miles and access to services such as priority booking, check-in, security and passport clearance, they said.

While Taiwan has traditionally placed huge sums of money in China, cash is also increasingly flowing the other way.

In the period from mid-2009 until the end of September 2012, Taiwan had approved a total of 303 investments by Chinese firms totalling US$315 million (S$385 million), according to the island's Investment Commission.

Taiwan and China split in 1949 at the end of a civil war, but Beijing still considers the island part of its territory awaiting reunification, by force if necessary.

However, ties have improved considerably since Beijing-friendly Ma Ying-jeou became Taiwan's president in 2008. He was re-elected last year for a second four-year term.

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