Chinese aviation officials have given their strongest commitment yet that they want to reach a new -- and much more liberalized -- aviation deal with the U.S. by the end of May, U.S. Transportation Secretary Mary Peters tells The DAILY.

After a round of "very positive discussions" in Beijing Friday, Peters said she is now even more optimistic that the May target is achievable. Peters had previously said the U.S. wants to have at least an interim deal in place by the time of the Strategic Economic Dialogue on May 22, but it was unclear whether the Chinese were as enthusiastic (DAILY, April 12).

The two nations have already held two rounds of aviation talks this year, but they did not close the wide gap between their objectives. In general, the Chinese have been much more reluctant than the U.S. to open up the aviation market. How much this has changed as a result of Peters' trip to China will be revealed during the next round of negotiations in China on April 25.

As expected, Peters and China Civil Aviation Minister Yang Yuanyuan didn't negotiate on any specific elements of the aviation deal during their meetings. "We have set a goal...[but] we didn't say 'here's how to get there,'" Peters said. That goal is "to have a meaningful agreement by end of the SED meeting."

The high-level accord means negotiators will likely have a much sharper focus when they return to the table next week. Although Peters and Yang will not be at these negotiations, there will be officials present who understand what the two leaders committed to achieve.

This increases the pressure on the negotiators to find common ground and will also make it unlikely that the Chinese negotiators will repeat earlier claims that they do not have authority to talk about eventual open skies. The question now will be how far toward full open skies the Chinese will be prepared to move -- and how fast.

Peters is confident that the agreement will include much greater liberalization, "with the end goal free market access." The U.S. proposals so far have included the gradual introduction of full open skies over three or four years. Just before his meeting with Peters last week, Yang said obstacles still remain, but China "would like to work towards open skies" (DAILY, April 16).

In general, China's largest airlines believe they have far less to gain from opening the U.S.-China market than their U.S. counterparts. Local journalists repeatedly questioned Peters on this point at media events in Beijing and Shanghai.

Peters, however, believes she made good progress in convincing the Chinese that liberalization would benefit both nations. Another positive sign was the lack of discussion on the difficulty Chinese travelers face in obtaining U.S. visas, which has been a point of contention in past talks.

Aside from liberalization, U.S. and Chinese officials also talked extensively about how the U.S. could help China with the domestic deregulation of its airline industry. To this end, the two nations want to expand their Aviation Cooperation Program to cover more economic and regulatory aspects, said Andrew Steinberg, DOT's assistant secretary for aviation and international affairs.

China is currently trying to achieve in a very short time the same kind of airline deregulation that took the U.S. many years to complete, Steinberg said. This means the U.S. has some insights that should be valuable to the Chinese, he believes. In a speech in Beijing last week, Yang confirmed this is an area where China will be looking to the U.S. for advice.

Specifically, Chinese officials have been curious about how the U.S. government protects consumers without interfering in pricing, how regional service can be encouraged, and how startup airlines are certified. China has "taken some steps...[airlines] have some latitude, but nothing like U.S. airlines," Steinberg said. "They want to [deregulate], but they also don't want to make the situation worse."