Can Tho International Airport in the Mekong Delta city of Can Tho. (Photo: dantri.com.vn)Can Tho (VNA) – The Mekong Delta city of Can Thoplans to open more domestic and international flights to the city by givingsubsidies to airlines, with a maximum subsidy of 8.5 billion VND (375,000 USD)a year, said a local official.
Vo Thanh Thong,chairman of the Can Tho People’s Committee, said the city had worked with theCivil Aviation Administration of Vietnam (CAAV) to open new routes to Hai Phong,Cam Ranh and Bangkok by the end of this year.
Can Tho isdrafting policies to provide support to airlines that open flights to the city,including initial support for office rentals, promotions, ground service feesand financial aid for vacant seats.
Airlines openingnew routes to and from Can Tho will enjoy incentives such as 12 months ofoffice rental at a maximum subsidy of 15 million VND (660 USD) per month percompany.
Ground servicefees will be halved in the first year for domestic flights, while internationalflights will receive an additional 30 percent discount in the following year.
The city willalso subsidise the first year’s losses for the airlines, at a maximum of 5billion VND for domestic flights per year, and a maximum of 8.5 billion VND forinternational flights per year.
To promotetourism development, the city has asked competent agencies to encourage travelfirms to offer preferential prices for tourists traveling by air to the city.
Can ThoInternational Airport has domestic flights to Hanoi, Phu Quoc, Con Dao and DaNang.
Meanwhile, routesconnecting the city with Da Lat and Cam Ranh (Nha Trang) have been suspendeddue to losses.
For internationalroutes, flights from the city to Taipei are only operated during Lunar New Yearholidays, while chartered flights to Bangkok have been suspended.
The city plans toopen three new domestic flights to Vinh, Da Lat and Cam Ranh and five newinternational flights to Bangkok, Singapore, Seoul, Taipei and Tokyo by 2020,according to Thong.
Airlines’reaction
In response,airlines do not appear to be interested in the move, saying flights to Can Thoare not attractive due to low demand. Opening new flights, they said, would notrecover capital unless the rate of occupancy of seats reached 70 percent.
A representativeof the budget airline Vietjet said flights to Can Tho were not an attractiveroute compared to other domestic routes.
Meanwhile, arepresentative of Jetstar Pacific, said that if there was demand, it would runa new flight without needing a subsidy.
The airlineopened a flight from Hanoi to Can Tho in 2009, but it was suspended due to lowdemand.
Economist BuiQuang Tin said it was not rational to use the State budget to subsidise newflights to Can Tho.
“Many airlineswant to open flights in Vietnam. Why do we have to use the State budget tosubsidise flights while the budget is now limited,” Tin said.
Vo Huy Cuong,deputy head of the CAAV, said the city must study the demand and potential ofthe new flights to Can Tho before making a decision.
If there is apotential, the new flights to Can Tho would help ease the burden for Tan Son Nhatinternational airport, which is now seriously overloaded, he said.
Last year, thenumber of visitors to Can Tho grew 14 percent year-on-year to reach 5.3 million,including more than 590,000 foreign visitors.
Total tourismrevenue reached 1,826 billion VND (80 million USD), a rise of 5 percent overthe previous year.-VNA
Vo Thanh Thong,chairman of the Can Tho People’s Committee, said the city had worked with theCivil Aviation Administration of Vietnam (CAAV) to open new routes to Hai Phong,Cam Ranh and Bangkok by the end of this year.
Can Tho isdrafting policies to provide support to airlines that open flights to the city,including initial support for office rentals, promotions, ground service feesand financial aid for vacant seats.
Airlines openingnew routes to and from Can Tho will enjoy incentives such as 12 months ofoffice rental at a maximum subsidy of 15 million VND (660 USD) per month percompany.
Ground servicefees will be halved in the first year for domestic flights, while internationalflights will receive an additional 30 percent discount in the following year.
The city willalso subsidise the first year’s losses for the airlines, at a maximum of 5billion VND for domestic flights per year, and a maximum of 8.5 billion VND forinternational flights per year.
To promotetourism development, the city has asked competent agencies to encourage travelfirms to offer preferential prices for tourists traveling by air to the city.
Can ThoInternational Airport has domestic flights to Hanoi, Phu Quoc, Con Dao and DaNang.
Meanwhile, routesconnecting the city with Da Lat and Cam Ranh (Nha Trang) have been suspendeddue to losses.
For internationalroutes, flights from the city to Taipei are only operated during Lunar New Yearholidays, while chartered flights to Bangkok have been suspended.
The city plans toopen three new domestic flights to Vinh, Da Lat and Cam Ranh and five newinternational flights to Bangkok, Singapore, Seoul, Taipei and Tokyo by 2020,according to Thong.
Airlines’reaction
In response,airlines do not appear to be interested in the move, saying flights to Can Thoare not attractive due to low demand. Opening new flights, they said, would notrecover capital unless the rate of occupancy of seats reached 70 percent.
A representativeof the budget airline Vietjet said flights to Can Tho were not an attractiveroute compared to other domestic routes.
Meanwhile, arepresentative of Jetstar Pacific, said that if there was demand, it would runa new flight without needing a subsidy.
The airlineopened a flight from Hanoi to Can Tho in 2009, but it was suspended due to lowdemand.
Economist BuiQuang Tin said it was not rational to use the State budget to subsidise newflights to Can Tho.
“Many airlineswant to open flights in Vietnam. Why do we have to use the State budget tosubsidise flights while the budget is now limited,” Tin said.
Vo Huy Cuong,deputy head of the CAAV, said the city must study the demand and potential ofthe new flights to Can Tho before making a decision.
If there is apotential, the new flights to Can Tho would help ease the burden for Tan Son Nhatinternational airport, which is now seriously overloaded, he said.
Last year, thenumber of visitors to Can Tho grew 14 percent year-on-year to reach 5.3 million,including more than 590,000 foreign visitors.
Total tourismrevenue reached 1,826 billion VND (80 million USD), a rise of 5 percent overthe previous year.-VNA
VNA
