New Open Skies Agreement to Increase Trade and Tourism Opportunities With United States
The United States and Mongolia have taken a major step towards establishing non-stop flights between the two countries with the signing of an Open Skies Agreement. The agreement, which was signed on January 24th in Washington D.C., is the first bilateral agreement in the aviation industry between the two countries.
The agreement is a liberal one, allowing air carriers to share flight numbers, as well as the capacity and frequency of flights to any destination, in line with the US "Open Skies" policy.
The Open Skies Agreement is expected to improve the economic and trade circulation between the two countries, creating new opportunities for air carriers and tourism companies.
However, while the agreement marks real progress, there is still work to be done before flights can begin. The two countries must complete internal procedures and Mongolia must be certified in technical, safety, and security areas before flights can start. It's not yet clear how long this process will take, but it's a necessary step toward making air travel between the United States and Mongolia more affordable and convenient for travelers and shippers.
MIAT airline is also planning to buy a large Boeing plane for non-stop flights to the US.
This agreement with Mongolia can expand the strong economic and commercial partnership between the two countries, promote people-to-people ties, and create new opportunities for airlines, travel companies, and customers. It also commits Mongolia to higher standards of aviation safety and security as the country looks into welcoming more than one million tourists in 2023 and 2024.
The Mongolia-US Open Skies Agreement is a significant step forward in expanding partnerships and promoting increased travel and economic opportunities between the two countries.
While there is still work to be done before flights can begin, the signing of the agreement marks real progress in this endeavor.
Currently, the only way to fly from the U.S. to Mongolia is through a connecting flight via Asia or Europe.
Despite increasing interest in traveling to Mongolia, the cost of plane tickets remains a major deterrent for most tourists.
This is primarily due to the limited number of flights available and the dominance of the government-controlled domestic airline, MIAT, in Mongolian airspace.
The government of Mongolia needs to take steps to liberalize its aviation sector following its signing Open Skies agreement, which aims to increase the number of flights and routes available, as well as remove restrictions on pricing and ownership. A more competitive and consumer-friendly airline industry in Mongolia can help the country to attract more tourists and visitors.
International airlines such as Korean Air and Turkish Air can further expand their operations in Ulaanbaatar. Additionally, the government needs to lift limitations that prevent foreign airlines from adding Mongolia as a new destination.
However, the privatization of MIAT (Mongolian Airlines) which could bring in new investors and reduce costs, has yet to be realized.
Amar Adiya is Editor-in-Chief of Mongolia Weekly and a regional director at strategy firm BowerGroupAsia, helping Fortune 500 companies shape policies in Indo-Pacific.