Accessibility links

Breaking News
News

Asian Airlines Struggle With Oil Prices - 2004-08-23

update

The skyrocketing cost of oil is starting to take its toll on air carriers across Asia. Both Australia's Qantas and Singapore Airlines announced new surcharges this week that will increase prices by as much $22 a ticket on some international flights.

Industry insiders say passengers may be stuck paying those costs for the foreseeable future.

Sim Kok Chwee, the director of the Pacific Asia Travel Association, says "for as long as the price of oil continues to stay above the $40 a barrel level, airlines will probably keep the fuel surcharge."

News on the ground this week in Asia was a bit more upbeat.

South Korea's economy grew slightly faster than expected, rising 5.4 percent in the second-quarter.

South Korean steel giant Posco started work on a new $1 billion plant near the southern port of Pohang.

The world's leading iron and steelmaker also entered into negotiations with mining powerhouse BHP Billiton to jointly build a steel plant in eastern India.

Officials from the Indian state of Orissa say the project would be India's largest steel plant and would employ about 40,000 workers.

Elsewhere in Asia, Swiss pharmaceutical company Novartis announced it would build a major new production facility in Singapore.

Novartis spokesman Satoshi Sugimoto says Singapore was the logical location for the company's first plant in Asia that will produce drugs for the global market. "Very clearly when it comes to the economic environment, when you look at patent protection, when you look at the quality of the work force, Singapore is working hard on being an attractive location for this kind of activities," he says.

Singapore recently welcomed similar investments from industry leader Pfizer and GlaxoSmithKline.

Singapore says it will continue to expand its bio-medical industry and increase output to $14 billion a year by 2014.

XS
SM
MD
LG