As U.S. trade negotiations with China continue to drag on, it seems that some are losing faith in our commander-in-chief and his ability to make a deal on the global stage. Yet, behind the scenes, President Trump and key members of his cabinet have worked tirelessly to secure and protect important agreements with our international partners, often with little fanfare. One such example of this is the Trump administration’s preservation of Open Skies agreements with the United Arab Emirates (UAE) and Qatar.
For the uninitiated, Open Skies agreements are air transport agreements that the U.S. negotiates with foreign countries to liberalize the rules for international aviation. These agreements create an open and competitive aviation market by getting government out of the decision-making process when it comes to airline routes, ticket prices, and capacity, amongst other things.
In 2001 and 2002 respectively, the United States signed Open Skies agreements with Qatar and the UAE, ensuring important access to each other’s markets. Yet, over the past few years, some of the larger U.S. airlines began to express concern over their ability to compete with Gulf carriers, lobbying the Trump administration to review our Open Skies pacts with these countries.
In response, last year the State Department entered into discussions about our Open Skies agreements with Qatar and the UAE and examined the big airlines’ concerns. Thankfully, after that process, the administration reaffirmed these agreements by signing Records of Discussion with both countries, ensuring important access to each other’s markets would not be disturbed.
This past January marked the one-year anniversary of the State Department signing the Record of Discussion with Qatar, and, with the anniversary of the Record of Discussion with the UAE coming up in May, it is important to understand how America has benefitted from the decision to protect our longstanding Open Skies policy.
Consumers reap substantial benefits from Open Skies agreements, as competition brings cheaper fares and greater flight options. A study from the Brookings Institution found that Open Skies agreements yielded “at least $4 billion in annual gains to travelers… which includes almost a 15 percent reduction in fares.” On top of this monetary benefit, Open Skies has allowed domestic airlines to expand their routes, giving Americans more choice when booking flights.
U.S. workers and businesses are positively impacted by Open Skies as well since the agreements bring millions of new foreign tourists to the United States. According to the U.S. Travel Association, travelers spent $1 trillion in the U.S. in 2017, supporting 15.6 million American jobs. Without foreign travelers, tourism businesses like hotels, rental car companies, and restaurants would lose a large portion of their customer base.
Yet, the best part is that these agreements will continue to pay dividends well into the future as new flights are added under the Open Skies regime. Research prepared by Hawaiian Airlines found that “adding a single daily wide-body flight carrying predominantly foreign-originating tourists can result in $64.8 million in direct spending, $116.7 million in U.S. GDP growth and more than 1,150 U.S. jobs.” If the United States were to abandon Open Skies, we could kiss these additional economic contributions goodbye.
While it’s easy to get caught up in the 24-hour news cycle and the pundits that antagonize the President, the Trump administration deserves credit for the under-the-radar wins they have secured on behalf of the American people. By protecting Open Skies, the President has proven that he puts the interests of the American people first and that he will continue to do so while he notches other wins through diplomacy.