Pressure on China to open up air distribution to foreign systems

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The US secretary of commerce has called on China to reconsider its position on the ban on overseas Global Distribution Systems from operating in the country.

Penny Pritzker, in what is likely to be one of her last keynote speeches ahead of a new administration taking office in January 2017, says a joint commission on commerce and trade wants to maintain its pressure on Chinese officials so that the GDSs can obtain access to the enormous market in the country.

She adds:

“We will continue to work with industry and our Chinese partners to address market access issues, such as opening the sale of outbound travel in China to US companies and ensuring the ability of foreign global distribution services platform to operate in China.”

Her comments came during a speech to mark the conclusion of US-China Tourism Year, a collaborative effort between the two governments to raise awareness of destinations for travellers and tackle areas such as tourist visa requirements.

Currently, foreign GDSs are only allowed to handle international tickets for outbound travellers, as part of an agreement with state-owned operator TravelSky.

Amadeus, Sabre and Travelport are prohibited from handling any travel bookings for intermediaries on any Chinese domestic route.

The Travel Technology Association, a US lobbying group, says Pritzker’s comments are “shining a spotlight on the inability of foreign-based global distribution systems to access the Chinese domestic market as a direct result of the policies and restrictions currently imposed by the Chinese government and key state-owned enterprises”.

President of the TTA, Steve Shur, adds:

“Simply by elevating the issue in this manner, in such a public forum and in the presence of key officials within the Chinese government, the prospect for change has increased considerably.”

The TTA and others claim that an opening up of the marketplace to foreign players will improve the “efficiencies” of Chinese airlines and travel agencies in the country.

Such a relaxing of restrictions would include “the opportunity to sell additional services, more accurately control inventory, and better serve their customers, while providing consumers with better tools to search for low fares and identify a greater range of travel options”, the TTA argues.

US president-elect Donald Trump has not shown any signs so far that he shares his predecessor Barack Obama’s position on trade and political relations with China, so a hardening of the relationship between the two countries will not help those seeking a relaxation of the current rules.

Still, an Amadeus official says:

“We are aligned with and support the TTA position. We consider that opening the Chinese market is positive for Chinese airlines, travel agents and consumers, as they would gain access to a wider range of technology and travel options.

“This is particularly important taking into account the recent collaboration between the US, the EU and China to promote travel and tourism.”

Pritzker’s nominated replacement as secretary of commerce is investor and Republican, Wilbur Ross, subject to confirmation hearings.

NB: China airport image via Pixabay.

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