The Chinese air travel industry is all set to take off

Have you heard? There's a sports event being held in Beijing this summer. The marketing build-up to 08.08pm on 08/08/08 is now, with six months still to go, ubiquitous. But while the world's attention is focused on the Olympic Games, I've been mesmerised by the phenomenal growth of China's aviation industry.

It's not just the physical projects such as the new terminals at Beijing and Shanghai Pudong (opening next month), or the other 42 new airports and 16 airport expansions in China's Five-Year Plan for 2006 to 2010 (the government has already built 47 since 1990). It's also the fierce competition between airlines in a booming market.

Air travel in China is predicted to climb from 179 million passenger trips (44 million international, 135 million domestic) to 270 million in 2010, and Chinese carriers have pole position in the race to exploit it. They are expected to double the size of their fleets in the next two years. China Southern, which reported a tenfold increase in pre-tax profits for last year, will soon be one of the world's largest airlines, with over 400 aircraft.

At the end of March, one of the most lucrative routes in the region, Hong Kong to Shanghai, is being liberalised under the revised Hong Kong SAR-Mainland bilateral air services agreement. Cathay Pacific and Air China have been battling to fend off their regional rival, Singapore Airlines, which has been trying to buy a quarter stake in the incumbent, China Eastern, China's third largest airline. It's typical of the power-play going on between airlines as they jostle for position in the world's fastest growing air market.
Airlines from outside the region are jostling for access, too. Back in December, the 17 airlines of the Star Alliance were happy to welcome Air China and Shanghai Airlines to their ranks, giving their passengers routes to some 40 destinations they didn't have before. And in January the US Department of Transportation allocated a batch of new routes and extra frequencies to US carriers for services to China in March 2009.

Here in the UK, a BA spokeswoman says services to the country are among the carrier's most profitable and booming, adding that getting a visa is now easier than ever.

There is a certain inevitability to China's aviation boom. Wage inflation, plus a growing curiosity in the outside world, has created a huge demand for flights. China is fast becoming a huge tourism market and its own carriers look best placed to exploit it.