This week, two Middle Eastern airline giants will talk with the Civil Aeronautics Board and press our officials to grant them additional rights to fly to Manila.
At present, Emirates of Dubai and Etihad of Abu Dhabi in the United Arab Emirates each have 14 flights per week, competing with our Philippine Airlines with 7 weekly flights to Dubai and another seven to Abu Dhabi, and Cebu Pacific, which has 7 flights per week to Dubai.
The Philippines-UAE market is not really that big if we’re talking businessmen/investors or tourism. It’s profitable only because we have thousands of overseas Filipino workers leaving the country each day in the great Filipino diaspora. And coming back to the country every two years or so, in-between breaks from their work contracts.
But the UAE has of late become a convenient jump-off point for Europe, which is one of the favorite travel destinations of the more affluent Filipinos, as well as the upper middle-class. The Tourism Infrastructure and Enterprise Zone Authority (TIEZA), which used to be the Philippine Tourism Authority, has seen its collection of the travel tax treble in the last 10 years because of “cheaper” flights to almost all destinations, whether in Asia or to Europe.
Philippine Airlines has reopened its flights to Europe, with London as its gateway, and soon, if memory serves me right, Paris. That took a long time and great effort on the part of our flag carrier to get, after all European airlines except KLM abandoned the Philippines due to low passenger volume and airport safety concerns.
Now that PAL, and even Cebu Pacific, have begun to expand their services, the UAE-based airlines, Emirates of Dubai, Etihad of Abu Dhabi, and Qatar of Doha, which have been given basically the same frequencies that they have given to PAL and Cebu Pacific, are asking the CAB for much more.
These airlines are heavily subsidized by their governments which form the conglomerated UAE. Etihad and Emirates alone receive as much as 23 billion US dollars worth of subsidies from their oil-rich governments. PAL and Cebu Pacific get nothing by way of subsidy from our “poor” government. Their bread-and-butter is really the OFW market. Now the Arab carriers want to get this market whole hog. Because of their huge subsidies, they can undercut our local carriers, and when these two Filipino airlines go belly-up, unable to compete with the Arab carriers, then they will go for the kill. That’s predatory, but then that is how business operates.
Which is why there is a government agency, in this case, the CAB, which should look not only in terms of immediate “consumer” advantages, but the medium-term outlook and the survival of our struggling airlines.
The UAE carriers have been quite aggressive in the market in the last few years. They land in almost all major cities of Europe, through their Dubai, Doha and Abu Dhabi airports, unlike PAL for one which has landing rights only in London and Paris. Soon, even if it would take a longer flight time, they could poach substantially into the US East Coast market, which PAL got only last year, confined by US authorities for the longest time to just San Francisco and Los Angeles in the West Coast.
Last year, Emirates was fined by the CAB, mismo, for selling illegally, tickets on flights which were not approved by CAB. It slapped the airline with a P1.8-million penalty, peanuts for the Arab carrier, so why should CAB now entertain their request for additional flights?
Even US airlines are complaining to their government, pointing to the heavy subsidies the UAE carriers are getting, which smacks of unfair competition. Canadian, German, French and Dutch authorities are likewise taking a second look, and some have stopped giving landing rights.
If CAB gives in to the Emirates and Etihad “requests”, nay, “demands”, they will each have 21 flights per week, more frequencies than our airlines get from their Middle-Eastern routes.
Yet here we are, willing to listen, and unless stopped, may give in.
I recall a former legislator and foreign affairs minister who, when apprised of the abuse of some of our women OFWs in the Middle East, facetiously remarked, “If rape is inevitable, better enjoy it.” He was never forgiven for that remark, likely said in jest.
But here in this benighted land, now labeled “banana republic” by no less than its justice secretary, it seems government enjoys being, well…”raped.” Or is it for “millions” of reasons?
Palagi na lang tayong nagpapatalo, nagpapa-daig, nai-isahan. But why must we always lose out?