Monday Jul 07 2008
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Concerns and opportunities in direct China-Taiwan flights
Published: Jul 07, 2008 

China and Taiwan have launched regular direct flights for the first time in nearly 60 years.

The new service connecting old enemies means travellers no longer have to stop over in Hong Kong or other cities.

For more than 50 years, Taiwan has restricted cross-Strait trade and travel, after it broke away from mainland Communist China in 1949.

The flights are being seen as a sign of a openness towards Beijing, under new Taiwanese President Ma Ying-jeou.

The influx of mainlanders is not popular with everyone, and analysts say it will have costs and benefits.

China accounts for 40 per cent of Taiwan's trade and direct transport links will benefit many businesses.

Taipei-based senior corporate analyst for Standard & Poor's, Daniel Hsiao, told Radio Australia's Connect Asia program, the decision by Beijing to allow mainland travellers to visit Taiwan will also be beneficial.

"That part will definitely [be of] benefit domestically, including tourism and retail and hotel, those types of industries.

"Some estimate it will stimulate domestic GDP growth, so that part is positive" he said.

Mr Hsiao says, however, Taiwanese will "need time to communicate" with the mainland visitors, and says there is a perception that mainlanders have "below average cultural standards."

"At least for a few months or quarters there's a transition period," he said.

"Taiwanese are still struggling between independence and unification with China, so this is a political issue and ideology issue, nothing to do with economics.

"Some people still don't like Chinese tourism there."

From Taiwan merchants' charter flights in 2003, to Chinese traditional festivals charter flights, and to weekend charter flights which take off on July 4, 2008, China mainland and Taiwan are walking smoothly towards regular direct cross-straits flights.
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