The meeting of Asia Pacific Economic Cooperation (APEC) Transport Ministers in June 1995 asked a small group of members to draw up a paper to identify options for ‘more competitive air services with fair and equitable opportunity for all APEC member economies’. This paper was prepared at a meeting of the Small Group in October 1995.2 The paper was submitted to Transport Ministers but it was not until this year at the 1997 meeting of Transport Ministers that the issue became active again. The 1997 ministerial group asked the Small Group to reconvene to provide more advice on ‘priorities’ among the list of options that it had prepared. It is argued below that the original paper raised some of the important issues in this sector but that it could have gone further, and that certainly some of the ideas require elaboration before the proposals can be ordered into priorities. The aim of this paper is to present a framework in which a fuller set of options can be generated and evaluated. It is also intended to illustrate the application of this framework with a set of suggestions for an APEC agenda (see Table 3 for a summary of those suggestions). The next section of the paper outlines the nature of the current regulatory arrangements for international aviation. There follows a discussion of some of the pressures for change in the system. The policy options suggested by APEC’s Small Group and those proposed by a number of other reports are then examined in the context of this review of the features of the system and the forces for change. The paper concludes with suggestions about APEC’s air transport ‘schedule’
