Flag-caniers are the fashion,

but how viable are they?

The Island countries of the Pacific now have a total of nearly 40 airlines and air service operators, covering international services, dom estic services and third-level

Charter-type) operations.

Fhese are the Islands’ own air :ompanies, and the figure does lot include international oper itors from Australia, New Zea and, France and USA who 'etain some operating rights nto Pacific Island destinations.

Some of the operators in the Islands represent investment Tom outside and some have ninority shareholding links *vith airlines from developed countries but their identities are n the Island countries where ;hey are based.

It is only in the past 12 years

or so that this picture has developed, keeping in step with political changes which have seen the emergence of the independent states of the Pacific. A major part of the change has been the heavy involvement of Island govern ments in airline ownership. Os tensibly the governments have gone into the airline business because they accept respons ibility for passenger and freight services. Although this attitude may be sound enough where domestic flights or near neighbour flights are con cerned, it is more open to question when wide-ranging in ternational services are in volved. It is difficult to escape the conclusion that much of the international flying is blatant image-building for national prestige, no matter how much

this might be denied by some of the governments concerned.

The major international oper ators which have emerged from the Pacific Island countries are Air Niugini in Papua New Guinea, Air Nauru in Nauru, Air Pacific in Fiji and Polynesian Airlines in Western Samoa.

Financially all four of these airlines have been having a rough time although in their generally-published statements they tell a story of seeking bigger and shinier aircraft and of providing better and wider services. PNG and Fiji to some extent admit their airline financial difficulties, although drastic action within Air Niugini has led to a prediction by the deputy prime minister, Mr Okuk, that this year’s result will be a pre-tax profit of nearly

K 2 million. Western Samoa, which has just taken delivery of a Sl5 million Boeing 737, de nies any financial problem in its airline structure despite early indications that this year will produce a loss of $1.5 million.

Nauru gives the appearance of simply not caring what its national airline costs, and con tinues to sink a significant proportion of its budget into a losing airline. In the latest figures available Air Nauru incurred a 12-month loss of $ 15.9 million about a quarter of the national budget.

Some of the international operations of Island airlines are important in terms of Pacific development because of the links they provide with close neighbours. In this sense such operations amount to an exten sion of domestic flights across

the nearest border. Air Pacific, Air Nauru, Air Niugini and Polynesian Airlines all provide services of this nature. Oper ators in some of the smaller countries do the same.

Over a number of years there have been suggestions that the Pacific Island countries should rationalise their air services even to the extent of creating a single international airline, but

at least to provide integrated co operation. The South Pacific Forum has held discussions on these lines and the Association of South Pacific Airlines has received submissions from a world expert who advocates closer integration of services. So far however the ‘flag-carrier’ concept has proved too strong to allow much change in the pres ent situation.