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Aviation

After a difficult few years for many airlines, the aviation sector in the Pacific is being revitalised, thanks largely to new carriers who are competing with national carriers or merging with them. Papua New Guinea, Samoa and Tonga now have more frequent and competitively priced international services and competition has led to lower fares, more passengers and more tourists to Fiji and Vanuatu.

Because fleet sizes and passenger loads are small and destinations are remote in the Pacific, some airlines have adopted partnerships where they operate services on behalf of each other, manage spare parts, holiday marketing and frequent flyer programs.
 
Domestic air services within Pacific island countries vary in their traffic levels and commercial viability. For the most part, domestic air services are entirely or partly provided by government-owned airlines. Cook Islands and Tonga have shown that involving the private sector generally leads to more sustainable services. For example, three private investors own Air Rarotonga which flies to nine destinations in Cook Islands. Routes that are not commercially viable are cross-subsidised by more profitable routes without government support. In Tonga, the minority shareholder Air Fiji, provides the aircraft and crew, while the majority shareholder - a local travel agent - handles distribution and marketing.

International airports in the Pacific are maintained to an adequate standard but smaller domestic airports and airstrips suffer from limited resources. At present, revenue from non-aeronautical operations, such as rents from retailers, makes up less than 30 per cent of revenue for Pacific island airports. More commercial activity would boost revenue and provide opportunities for local business people.