The proposal being considered by the government to allow foreign airlines unrestricted access to northern Australian air routes is a good one. In fact, it’s so good, it ought to be extended to the entire country.

The Australian aviation industry likes to argue Australia has one of the most liberal access regimes in the world. The only problem is, compared to other industries, our aviation regime remains hopelessly protectionist in refusing to allow foreign airlines unrestricted access to Australian routes unless laborious and expensive negotiations are conducted between bureaucrats to establish reciprocal access.

The industry insists any liberalisation should be conducted on a reciprocal basis. But as we know from other forms of trade negotiations, the greatest value from liberalisation comes from unilaterally lowering protectionist barriers, not waiting for other countries to reduce their barriers. The benefits to Australia of liberalisation in areas like tourism, business travel costs, perishable exports and air freight would be significant.

Needless to say, the industry incumbents are against the northern Australia proposal. That’s a good sign that it would yield plenty of benefits for the wider economy. If it’s good enough for northern Australia, it’s good enough for the rest of us, surely?

Peter Fray

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