The government has given in principle approval for Vietstar Airlines to provide passenger and cargo transport services.
Once officially approved, Vietstar Airlines will become the fifth carrier in Vietnam, joining Vietnam Airlines, Jetstar Pacific, Vietjet Air, and the Vietnam Air Services Co. (VASCO).
“The government has approved in principle the airliner’s documents, which have met requirements,” Mr. Lai Xuan Thanh, Head of the Civil Authority Aviation of Vietnam (CAAV), told VET. “It’s now waiting for final approval.”
Mr. Pham Trinh Phuong, CEO of Vietstar Airlines, also confirmed withThoi bao Kinh te Vietnam, VET’s Vietnamese-language sister publication, that it has met all requirements relating to capital to provide passenger and cargo services and has received in principle approval and is now waiting for final approval.
Mr. Phuong also said that if things go smoothly the carrier could complete necessities for launching before the end of the year, without revealing specific dates.
In March this year the Ministry of Transport (MoT) proposed the government allow Vietstar Airlines provide passenger and cargo transport services. The proposal was rejected, however, by the Ministry of Finance due to financial requirements contained in Decree No. 30, which Vietstar Airlines had not met.
Decree No. 30 requires an airline have at least VND700 billion ($30 million) in capital, while Vietstar Airlines had only VND625.7 billion ($27.5 million) as at the end of 2015.
Vietstar Airlines was established in 2010 by the Ministry of Defense, with stakeholders including the Aircraft Repairing Company A41, the Vietnam Air Force, Vietstar Airways, and the Tin Thanh Express Company.
The six-year-old carrier, which currently has a fleet of five passenger aircraft and two cargo aircraft, including Boeing 737s and Airbus 320s, is expected to carry 500,000 passengers and transport 32,000 tons of freight during its first year of operation.
Once taking off, Vietstar Airlines is expected to focus on domestic routes between northern and southern Vietnam as well as routes to northeast and southeast Asian countries.
Vietnam also has three general aviation carriers: Blue Sky Co., Hai Au Aviation, and Green Planet Airways. Its civil aviation market is expected to rise 19 per cent to 45 million passengers this year, riding on the back of strong economic growth and lower fuel costs, according to MoT.
The country is also considered one of the seven fastest-growing aviation markets in the world, with growth of 21 per cent in 2015, and is forecast to continue to see double-digit growth every year, according to the Center of Asia Pacific Aviation (CAPA).
VN Economic Times
