1 SUB-REGIONAL COOPERATION ON AIR TRANSPORT AMONG CAMBODIA, LAO PDR, MYANMAR AND VIET NAM

2 Participating Countries:  The Kingdom of Cambodia - area: 181,035 km 2, population: 10.7 million;  Lao PDR - area: 236,800 km 2, population: 4.58 million);  The Union of Myanmar - area: 676,552 km 2, population million); and  The Socialist Republic of Viet Nam - area: 329,707 km 2, population: 80 million). * All the four countries are members of the United Nations, ICAO, and ASEAN

3 Major cities and important tourist spots in the Sub-region:  Phnom Penh, Sihanoukville, Kep, Kompong Cham, Battambang, Siem Reap (Cambodia);  Vientiane, Luang Phabang, Savanakhet, Pakse (Lao PDR);  Yangon, Mandalay, Mawlamyaing, Heho (Myanmar); and  Ha Noi, Ho Chi Minh City, Da Nang, Hue, Hai Phong, Da Lat, Dien Bien Phu (Viet Nam)

4 The Establishment of the CLMV Sub-regional Air Transport Cooperation: Date: January 1998 Place: Ho Chi Minh City, Viet Nam

5 Operation of the CLMV Sub-regional Cooperation: - Operational rights: no limitations as to capacity and frequency; no limitation as to the number of designated airlines; the study of broadening the criteria of airline ownership and control; - Route Rights: no limitations as to route structures;

6 - Traffic Rights: no limitation as to the 3rd, 4th and 5th freedom traffic rights; - Tariffs: dual disapproval principle; - Non-scheduled air services: no limitations; - Doing Business: no limitations.

7 - no limitations as to computer reservation system; - no limitations as to doing business matters; - application of dual disapproval principle of tariffs; - the study of broadening the criteria of airline ownership and control.

8 - to harmonize rules and procedures and to facilitate air transportation of passengers, mail and cargo; - to develop various forms of cooperation and assistance with respect to airports, airlines and air navigation, i.e. to establish brotherhood cooperation among airports; - to implement programs and projects to ensure aviation security and safety in the Sub-region in accordance with ICAO’s standards and recommended practices. - to provide assistance with regard to technology, finance, training;

9 - to exchange and help develop policies, legal documents; to cooperate between and among airlines in scheduling coordination, tariff coordination, code- sharing arrangements and joint ventures, etc.

10  Development of a Multilateral Agreement on Air Transport of the Sub-region: - to liberalize air transport; and - to foster comprehensive cooperation among the civil aviation of the four countries. * The Agreement is expected to be adopted at the Sixth DGCA Meeting which is to be held in May  Unification of policies and viewpoints of the four countries at other multilateral fora on the basis of ensuring the interests of all four countries.

11  Expansion of the sub-regional route networks: - to foster the traffic to/from and within the Sub-region; - to enhance investment, trade and exchange of culture; - to create favourable conditions for the forming of a common tourist market (with direct air links to capital cities, ancient capital cities and other important tourist spots).

12 Principles governing the operation of the Sub- region:  Four key principles: Cooperation, Mutual Assistance, Consensus, and Firm on common viewpoints  Official activities: - Director General of Civil Aviation Meeting; - Air Transport Executives Meeting; - CLMV Airlines, Tourism and Hotels Meeting

13  Rules and procedures for adopting a decision, resolution: - consensus; or - majority votes and a participating country will not be required to implement any decision or resolution if it votes against or abstains such a decision or resolution.

14  Form of coordinating: - The coordinating country is the host country of the DGCA Meeting on rotation basis  Dispute Settlement Mechanism: - amicable negotiations - ad hoc DGCA Meeting with a resolution adopted by majority votes. The Sub-regional Cooperation is an arrangement open to all other countries.  Admission of new members to The CLMV Sub- region: after 2006.

15 Importance, Purposes of the CLMV Sub- regional Cooperation: - The CLMV Sub-regional Air Transport Cooperation - an integral part of ASEAN cooperation; - Recognition of the four governments of the role of air transport in their national economic development and the indispensability of international air transport liberalization; - Policies of the four countries to actively take part in the international air transport liberalization in a gradual and consistent manner;

16 - to create a common international air transport market; to help foster the development in other fields such as trade, investment and international tourism of the four countries. - to create conditions for airlines of the four countries to gradually build up their competitiveness; to ensure practical interest of all participating countries in the cooperation.

17 Conclusion  Set clear orientation on air transport liberalization by participating countries, which will be an integral part of overall national market access opening, and it will serve to develop trade, tourism and investment; and in turn air transport will be developed based on general development of national economy.  Road map for air transport liberalization must be properly developed; airlines involved should take an active part in the implementation of such a road map.

18  Preferential measures accorded to less developed countries by more developed countries are required at governmental and airline levels to balance interests of all airlines exploiting the market which include but not limited to differences of the governmental exchange of route, operational and traffic rights; codesharing, providing seats free of charge and other forms of cooperation between airlines.  Beneficiaries of air transport liberalization should have relevant cooperation and coordination so as to ensure synchronous development of all industries concerned.