Rolls-Royce Agenda

The UK Lobby to Europe

December 12, 2012

The United Kingdom has finally agreed to amend the one sided bilateral Air Services Agreement (ASA) with the Philippines signed in 1965 granting the Philippines daily flight to London from Manila.

The earlier bilateral was tied with orders for the UK made BAC-111 used by Philippine Airlines (PAL) in 1967. The airplane was retired from service in 1986. Proposed amendments to the bilateral was not signed by the UK in 2009 for unknown reason.

UK Member of Parliament Hugo Swire on Tuesday signed the ASA with Transportation Secretary Emilio Abaya expanding the thrice a week service to London in order to boost tourism and trade between the two countries.

“We would like to see direct flights from the Philippines into the UK. It will be a commercial decision as to how many flights will work, and we would like to see that happen. After all we have a quarter-of-a-million Filipinos living in the UK,” Swire said.

The ASA is however the icing of the cake as it removes restrictions to fly to UK that would otherwise have  been uneconomical to fly directly in the first place. The Philippines was granted with three weekly frequencies and PAL let one frequency from British Airways while flying London until it stopped in 1998 due to the Asian Financial Crisis.

The UK and the Philippines agreed flights from three times weekly to 21 times a week - 7 times a week from Manila and Cebu and 7 times a week from elsewhere in the country.

A Senior management official from PAL privy to the matter but does not want to be identified because of confidentiality issues disclosed that the real issues with Britain was the multi-million US dollar orders for Rolls Royce engine. The UK built power-plants to power the 20 Airbus 330's on order was leveraged by San Miguel requiring Rolls Royce commitment from the European Union to grant exemptions to PAL, similar to the deal that was arranged with Garuda Airlines of Indonesia. Cebu Pacific also leveraged on the same exemptions.

Garuda ordered 24 A330 aircraft from Airbus all powered by Rolls Royce engines. They were subsequently granted exemptions to fly European Airspace although the rest on Indonesian Airlines are barred from entering the EU Airspace.   

Swire said during the press conference at Makati Business Club that he is meeting Ramon S. Ang, Philippine Airlines (PAL) President and COO, who hopes to start direct flights to London soon.

“And, incidentally, their passengers will probably be arriving on a new aircraft made partly in Britain,” he further said.

The UK minister categorically said that Britain would offer any form of assistance to help address the Philippine issues with the European Union, which to this day, has prevented the country’s air carriers from flying into European skies.

"We want to work with the Philippine government to look at the outstanding issues that the EU has, and try to resolve them so we can get these flights up and running as quickly as we can," he said.