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Hong Kong, US Strike 'Open Skies' Deal - 2002-10-21

The United States and Hong Kong agreed Saturday to give both Hong Kong and U.S. airlines greater access to each other's airports. The deal was welcomed on both sides following three years of tough negotiations.

Under the agreement, Hong Kong's main carrier Cathay Pacific Airways will have an unlimited choice to run services to and from American cities and code share with American carriers. In the past the airline was limited to seven cities and could not sell tickets on U.S. carriers. Likewise, American Airlines will enjoy code-share arrangements on carriers operating out of Hong Kong's international airport.

Analysts say the deal enhances the status of Hong Kong's Chep Lap Kok airport as a major logistics hub in Asia.

In other news, China's National Bureau of Statistics says it expects the country's economy to grow by 7.8 percent for 2002.

Chief Economist Andy Xie with Morgan Stanley Asia said a boom in China's exports is contributing to the country's strong growth rate. "Even though the growth rate out of other economies has disappointed, China has met expectations," he said.

Mr. Xie says low interest rates and labor costs combined with constantly upgraded infrastructure has been the catalyst for China's growth.

In Southeast Asia, Thailand's four major banks were upgraded last week to investment status by Fitch Ratings. The London-based agency upgraded long-term foreign currency ratings of Bangkok Bank, Krung Thai Bank, Thai Farmers Bank and Siam Commercial Bank.

The agency says Thailand's external position has improved considerably since the Asian Financial Crisis in the late 1990s.