Benefits of Canada-EU Open Skies Deal Likely to be Delayed by Economic Turmoil

(CEP News – Sean McKibbon)

A new air transport agreement announced between the EU and Canada could eventually mean lower fares and greater choice for trans-Atlantic travellers, but the global economic crisis could delay those benefits, says the president of the Tourism Industry Association of Canada (TIAC).

The agreement, announced this week by federal Transport Minister John Baird, will open access to all 27 EU member states for Canadian airlines and all points in Canada for EU air carriers. The agreement replaces 19 bilateral agreements with a single comprehensive one and allows the development of new markets, new services and greater competition, a Transport Canada news release said.

But TIAC president Randy Williams said the ongoing weakness in the economy will likely delay implementation of the agreement. "With the economic downturn, the airlines are just not looking at expanding routes and increasing their capacity at this time," he said.

Transport Canada officials could not give a precise date for implementation of the new agreement, but Williams said he hopes to see it in effect within the next three to four months.

"We're excited about this agreement. The discussion has been underway for some time," said Williams, adding that TIAC members are hoping it will foster greater travel, particularly by EU residents to Canada. Estimates are for travel between the two jurisdictions to increase 25-40% with an extra 8-14 million visitors to Canada, Williams said.

However, he said those estimates may be a little too optimistic given the current economic downturn. Read more here.