"Open skies" or open clubs? New issues for Asia Pacific economic cooperation

Abstract

Air transport continues to lie outside the rules of the world trading system. Yet pressures for changes in the management of trade in air transport services are emerging within the bilateral system of regulation, particularly through United States efforts to negotiate so-called 'Open Skies' arrangements, but also through new regional arrangements. A new method is outlined of exploiting the trends in regional cooperation and the pressures induced by the United States strategy to facilitate the liberalisation of air transport markets. This method applies the principles of what have been called 'open clubs'. The principles include transparency and openness to new members as well as the absence of an intention to discriminate against outsiders. These principles are consistent with APEC's strategy of open regionalism. The paper suggests that APEC is a suitable process within which to develop the application of the open club idea and it outlines the manner in which its principles might be applied to air transport.