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Plans for Open North American Aviation Market Inch Forward

Policy differences make reaching trilateral deal challenging

Washington – Sometime over the next the decade – but likely not in 2007 or 2008 - Air Canada could be competing with U.S. carriers on the New York-Paris route and Aeromexico might be launching flights between Los Angeles and Toronto.

This vision for an open North American aviation market inched a bit closer in April when the United States, Canada and Mexico announced a plan to work toward establishing a trilateral open skies agreement, according to U.S. officials.

“We have an opportunity to set a new global standard for free and open transborder air travel, and bring greater convenience and lower prices to shippers and travelers who want to reach places like Tucson, Toronto or Torreon,” U.S. Transportation Secretary Mary Peters said after meeting her counterparts from Canada and Mexico in Arizona where the announcement was made.

A U.S. Department of Transportation (DOT) official told USINFO that the process leading to a trilateral deal will be challenging but the potential rewards are substantial.  The declaration signed at the trilateral meeting calls for expandingaviation relationships over the next 10 years.

“The most significant piece of this document, in my opinion, is the vision for reaching a Trilateral Open Skies agreement between our three countries within the next 10 years,” said Peters.

The three countries hope that an open regional aviation market will help them accommodate the expansion of trilateral trade and tourism accelerated by the North American Free Trade Agreement (NAFTA).

 Negotiating civil aviation agreements is a complex effort, experts say.  Even bilateral aviation deals are difficult to reach because of competing interests of each country’s airlines, national security considerations and other issues. For example, the United States and the European Union signed an open skies agreement in March2007 only after several earlier attempts to liberalize the trans-Atlantic aviation market had failed.

The differences among the three governments’ respective aviation policies might make future negotiations to open the aviation market in North America particularly difficult.  It is anticipated that the first step toward a trilateral agreement will be for the U.S. and Canadian governments to negotiate separate bilateralaviation liberalization deals with the government of Mexico. The United States and Canada concluded an open skies agreement in November 2005.

Negotiations involving all three countries would have to address a number of important issues such as routes, user charges and fees, pricing, advertising and sales, and a uniform dispute resolution mechanism, according to the DOT.

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