Trump unlikely to renegotiate Open Skies agreement

16 November 2016

US airlines have accused Gulf carriers of unfair competition

US president-elect Donald Trump is unlikely to push for the government to renegotiate the Open Skies agreement with Qatar and the UAE based on a request by the US Big Three – Delta, United and American – according to a UK-based aviation analyst.

“[Donald] Trump coming into office will not immediately change the status quo,” says Saj Ahmad, chief analyst at StrategicAero Research. “He knows how the wheels of commerce work…. GCC airlines are regularly launching new flights to the US, bringing in more traffic, revenue and income to the US economy. Why would Trump want to block that?”

The Partnership for Open and Fair Skies, which represents the US Big Three, is understood to be planning to brief Trump and his new administration on “the massive subsidies that the UAE and Qatar governments provide to their carriers”.

This aligns with concerns that Trump’s protectionist stance, which was articulated during the election campaign, could translate into a reversal in policy for the Open Skies agreements with Qatar and the UAE.

However, Ahmad says Trump is not likely to give in to the lamentations of the US airlines in their “baseless rhetoric against Emirates [airline], Etihad [Airways] and Qatar Airways

According to Ahmad, Trump will want to secure jobs in the US and US aircraft manufacturer Boeing and jet engines supplier GE are two massive companies that rely heavily on orders from GCC airlines. “With the development of the [Boeing] 777X starting next year ahead of delivery to launch customer Emirates in 2020, Trump will be able to see that GCC airlines are indeed supporting hundreds of thousands of jobs within the US aerospace industry and supply chain,” he says.

Emirates declined to comment on the issue.

An Open Skies agreement signed between countries grants airlines equal access to airports in those countries free of interference from the national government.

In January 2015, the US Big Three filed a dispute with the US Department of Transport (DoT) alleging that Emirates, Etihad Airways and Qatar Airways had received enormous subsidies from their home governments over a period of 10 years in violation of the Open Skies agreement between the US, the UAE and Qatari governments.

All three Gulf airlines strongly denied receiving subsidies and presented their counter-arguments to the DoT, which refused the US airlines’ request to review the existing agreements or limit the Gulf carriers’ access to the US market.

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