Publicly listed national flag carrier Garuda Indonesia has agreed to provide special discounts, both on passenger tickets and on cargo services, for Indonesian companies attending national and international trade exhibitions
ublicly listed national flag carrier Garuda Indonesia has agreed to provide special discounts, both on passenger tickets and on cargo services, for Indonesian companies attending national and international trade exhibitions.
Under a memorandum of understanding (MoU) signed by the airline and the Trade Ministry on Thursday, discounts will be given to businesspeople attending trade exhibitions sponsored by the government.
Ministry employees conducting domestic and overseas business trips will also be given discounts under the agreement, which will be valid for three years.
Garuda Indonesia president director Arif Wibowo explained that the discounts offered by his company applied to both passenger tickets and cargo services.
'We will give a 20 percent discount on international airfares and 11 percent for domestic routes. For freight, the discount will be 5 percent for international services and 7 percent for domestic,' he told journalists after the signing.
He expressed hope that the agreements would benefit both parties.
'We are targeting US$300 million in revenue from our freight business and we're hoping that this cooperation will contribute between 10 and 15 percent of the targeted amount, or $30 to $45 million,' he said.
Last year, Garuda, which was named the world's eighth-best airline by London-based independent aviation ranking firm Skytrax, booked $240 million in revenues from its cargo services.
As part of the company's program to boost cargo services, Garuda recently signed a partnership agreement with cargo airline Cardig Air. Under the partnership agreement, Garuda will have the right to sell freight space on Cardig Air flights that serve routes to Surabaya, East Java, Denpasar, Bali, and Dili in Timor Leste. Meanwhile, Cardig Air will have the right to market Garuda's cargo space on several domestic and international routes.
According to the International Air Transport Association (IATA), Asia-Pacific freight carriers reported demand growth of 4.5 percent year-on-year in April, below capacity expansion of 7 percent.
Current trade volume for emerging Asia markets was down 10 percent, and the region had been affected by a slowdown in exports to Europe, IATA said.
However, Arif was optimistic that Garuda's cargo and export business would keep growing despite the global economic slowdown.
'It is true that Europe in general is facing economic problems. However, the micro economy of several countries, including the Netherlands and the United Kingdom, is still growing and is providing opportunities,' he said.
Trade Minister Rachmat Gobel said that the partnership with the national flag carrier was part of his ministry's program to achieve a 300 percent increase in export value by 2019.
'The ministry's efforts to tighten economic bilateral ties with other countries must be supported by transportation services. We hope Garuda can provide easy and smooth freight services for both exporters and importers,' he said.
Arif added that his company would also offer Trade Ministry employees special services, such as extra baggage allowances and dedicated check-in counters at Soekarno-Hatta International Airport in Tangerang, Banten and Changi Airport in Singapore. (prm)
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