[Congressional Record Volume 142, Number 14 (Thursday, February 1, 1996)]
[Senate]
[Pages S732-S733]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                UNITED STATES-GERMANY AVIATION RELATIONS

  Mr. PRESSLER. Mr. President, I rise today to discuss a critically 
important international aviation matter I have raised in this body on 
numerous occasions. I refer to the significant opportunity that has 
presented itself to fully liberalize our aviation relations with the 
Federal Republic of Germany.
  I am delighted to inform my colleagues that this morning the United 
States and Germany agreed on a framework for an open skies agreement. 
This is a major step in liberalizing aviation relations with one of our 
most important trading partners. A United States-Germany open skies 
agreement would produce significant new air service opportunities for 
all U.S. passenger carriers. Now that the mutually agreed upon 
structure for a liberalized air service agreement is in place, a round 
of formal talks has been scheduled for February 22 in Washington to 
finalize any remaining details.
  Mr. President, I would like to praise both the Department of 
Transportation 

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and the State Department for the excellent work they are doing in 
pursuing this opportunity. Also, I would be remiss if I failed to 
recognize the outstanding leadership German Transport Minister Matthias 
Wissmann has provided. I appreciate fully that Germany's membership in 
the European Union creates an added challenge in accomplishing our 
shared goal of securing an open skies agreement. For that reason, I 
commend Minister Wissmann for the great political courage he and the 
German Government have shown in pursuing this initiative.
  An open skies agreement with Germany is tremendously significant 
since it would benefit the U.S. economy, our airline industry and 
consumers. Let me briefly expand on each point.
  First, both immediately and from a long-term perspective, a United 
States-Germany open skies agreement would produce significant economic 
benefits for the United States. Due to the competitiveness of U.S. 
passenger and cargo carriers, they consistently generate for the United 
States significant net trade surpluses. I fully expect the same will 
continue to be true under a fully liberalized aviation regime with 
Germany. In fact, the performance of our cargo carriers under the 
liberalized air cargo agreement we signed with Germany in 1993 has been 
very impressive.
  Germany also would benefit greatly from such an agreement. To confirm 
this point, one need only look to the Netherlands which continues to 
reap enormous economic benefits from the open skies agreement we signed 
with the Dutch several years ago. Unquestionably, the economic benefits 
of open skies agreements are a two-way street. I believe a United 
States-Germany open skies agreement is an excellent long-term economic 
investment for both countries.
  Second, an open skies agreement with Germany would create tremendous 
new international air service opportunities for the U.S. airline 
industry. As I have previously explained to this body, such an 
agreement would generate both direct and indirect benefits for all U.S. 
passenger carriers.
  In terms of direct benefits, an open skies agreement with Germany 
would immediately produce new air service opportunities between the 
United States and Germany. Is there pent-up demand among U.S. passenger 
carriers to serve Germany? Absolutely. Recently, eight U.S. passenger 
carriers sought to offer 316 roundtrip flights between the United 
States and Germany each week during the 1996 summer season. Under the 
current bilateral aviation agreement, however, U.S. passenger carriers 
can only offer 276 weekly roundtrip flights to Germany. Under an open 
skies agreement, there would be no such limit and the number of 
roundtrip frequencies would be set by market demand, not governments.
  Equally important, German airports would provide well-situated 
gateway opportunities for our carriers to serve points throughout 
Europe, the Middle East, Africa and the booming Asia-Pacific market. Is 
it realistic to think that German airports will provide key gateways to 
the rapidly expanding Asia-Pacific market? Absolutely. In fact, Japan 
Airlines recently announced it intends to initiate new service between 
Osaka and Frankfurt. Non-stop service is presently available from 
Frankfurt-Main Airport to cities throughout the Asia-Pacific market 
including Hong Kong, Seoul, Bangkok and Singapore. Moreover, non-stop 
service to the Asia-Pacific market also is currently available from 
Munich Airport. These examples illustrate my point well.
  With respect to indirect benefits, an open skies agreement with 
Germany would be an important catalyst for further liberalization of 
air service opportunities throughout Europe. Since it is such a 
critical fact, let me reiterate a point I have made in this body 
before. An open skies agreement with Germany --in combination with 
liberalized air service agreements we already secured with the 
Netherlands in 1992 and with nine other European countries last year--
would mean nearly half of all passengers traveling between the United 
States and Europe would be flying to or from European countries with 
open skies regimes. Under such a scenario, competition would be our 
best ally in opening the remaining restrictive air service markets in 
Europe.
  Will an open skies agreement with Germany, or any other country for 
that matter, benefit all U.S. passenger carriers equally? Of course 
not. A market-oriented framework only guarantees carriers the 
opportunity to compete. As should be the case, the market will 
determine which carriers will benefit most under an open skies 
agreement with Germany. Overall, however, I do predict with confidence 
that the U.S. aviation industry as a whole will benefit immensely from 
unrestricted opportunities to serve Germany.
  Third, undoubtedly consumers in the United States and Germany would 
be the biggest winners. Due to enhanced service options as well as the 
assurance of competitive air fares, consumers always benefit most under 
open skies agreements.
  In conclusion, I am very pleased that we are well on our way to an 
open skies agreement with Germany. Such an agreement would be in the 
best economic interest of the United States and it would create 
considerable new international air service opportunities for all U.S. 
passenger carriers. Of great importance to me, consumers would reap 
significant benefits as well. I hope an open skies agreement with 
Germany will soon be in hand.
  Let me add that I know some of my colleagues are frustrated that we 
have not made more progress liberalizing air service opportunities with 
several other major trading partners. I share this frustration but do 
not believe it results from a lack of effort on the part of our 
negotiators. In fact, our successful talks with the Germans illustrate 
a critical element which has been lacking in those other negotiations. 
I refer to the keen vision the Germans have shown in recognizing that 
the economic benefits of an open skies agreement with the United States 
are a two-way street.
  In this regard, I believe my colleagues who are frustrated about the 
continued reluctance of the British to permit U.S. carriers greater 
access to London Heathrow Airport should be very pleased by this 
development with Germany. As I said earlier, competition will be our 
best ally in expanding air service opportunities with European 
countries such as the United Kingdom that continue to restrict the 
access of U.S. carriers. An open skies agreement with Germany will add 
great force to this market dynamic.

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