Asean and the European Union have concluded the world's first bloc-to-bloc air transport agreement, to allow their airlines to expand services to and within the respective regions. Once formalised, airlines of the combined 37 member-states - 10 of them from South-east Asia - can fly any number of non-stop flights between both regions. Critically, airlines also will be able to fly up to 14 weekly passenger services, and any number of cargo services via and beyond to any third country. This is cheery news coming amid the decimation of air travel caused by the Covid-19 pandemic. The deal could presage closer cooperation on issues from aviation safety to air traffic management and environmental matters.
The agreement is the result of years of intense negotiations, complicated in part by how the European Union is structured. Air rights also tend to be a sensitive subject to negotiate, especially since many airlines are considered "national carriers" that enjoy government support and subsidies. Nevertheless, this comprehensive pact comes not a day too soon. The EU is Asean's third largest source of investment and third largest trading partner, with US$10.5 billion (S$13.9 billion)of foreign direct investment inflows and US$226.2 billion of trade in goods in 2020. The agreement is billed as reflecting the latest policy thinking in air transport regulation, including robust fair competition provisions and issues around doing business.