Air China, the nation's flag carrier, will buy 20 Airbus A330-200s to serve its major international and domestic routes, airline spokesman Wang Yongsheng confirmed yesterday.

Although Wang did not elaborate on the deal, a statement issued on the website of the Hong Kong Stock Exchange - where the company is listed - revealed the airline will pay less than the total catalogue price of US$2.86 billion, but did not state the exact amount.

The new planes will fly to the airline's major international destinations in Europe, Australia, North America and certain key domestic destinations such as Lhasa, Air China said.

The deal, approved by its parent firm China National Aviation Holding Co, will be funded through cash from the company's operations and commercial bank loans, said the airline.

The aircraft will be delivered between the middle of next year and the end of 2008, the airline said.

The nation's biggest airline was listed in Hong Kong and London last month to attract more capital to serve its international ambitions.

But officials at the Beijing office of Airbus remained tightlipped about the deal, saying that they did not have information pertaining to it.

Controlled by European aerospace giant EADS, Airbus is competing with its rival Boeing to secure a slice of the growing Chinese market.

Last year, the France-based aircraft giant received a total of 81 orders from China.

Among them are 21 A320s from China Southern Airlines, 20 A330-300s from China Eastern Airlines, three A330-300s from Hong Kong's Cathay Pacific, six A319s from Air China and eight A319s from Hainan airlines.

China Southern Airlines is expected to sign an agreement in Paris today to buy five of the 555-seat A380s.

According to a Bloomberg report, the massive transaction will be worth US$1.4 billion.

Shanghai-based China Eastern Airlines also plans to order 20 aircraft this year, including A320s, A321s and Boeing 737-700s.

The airlines' expansion of their fleets is an indication of the robust growth taking place in China's civil aviation sector.

Last year was a good one for the industry, with total profits of 8.69 billion yuan (US$ 1.04 billion), according to the General Administration of Civil Aviation of China (CAAC).

These profits were equal to the sector's cumulative profits over the previous decade.

According to the CAAC statistics, passenger transport turnover totalled 120 million last year, a year-on-year increase of 38 per cent.

And the industry's cargo and mail transport volume totalled 2.7 million tons, up 23.3 per cent year-on-year.

Boeing has predicted that China will become the world's second-largest commercial aviation market, behind the United States, within 20 years, with China requiring around 2,300 planes over that period.

(China Daily January 28, 2005)