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US-UAE Business Council believes Open Skies agreements will stay put

The US-UAE Business Council is confident in its belief that the United States government will not revoke the Open Skies agreements between the two nations.

This, according to the President of influential membership body, Danny Sebright, who said:

“I think we’ve done a good job of inoculating against various efforts by the US carriers to find a champion on the inside of [President] Trump’s administration. Now I think we’re at a good place with it,” Sebright said.

“The UAE Ambassador and his team, as well as key US firms, have done a really good job of informing the Trump administration of the importance of [maintaining Open Skies agreements between the two countries].

“Saying that, it is still a critically important issue, and we have work to do to prevent legislative action that is not supported by the Trump administration,” Sebright added.

For years now, the US carriers have asked the federal government to put a stop to Gulf carriers’ rapid expansion to the country, which they say represents “unfair competition” and breaches Open Skies agreements.

They also claim that the three largest Gulf carriers – Etihad, Emirates and Qatar Airways – are the beneficiaries of subsidies from their governments to “unfairly” aid their growth. All three refute the claims and argue they have brought considerable economic benefits to the US.

Sebright said his council has asked to convey “the facts from our point of view,” in Washington circles, and argue the notion that the Gulf airlines are deeply subsidized.

“The bottom line is that Open Skies doesn’t have anything to do with subsidies. There is no provision in Open Skies anywhere that deals with subsidies. The US carriers are trying to invent an issue over subsidies and use existing bilateral Open Skies agreements as a false basis to change policy,” he said.

“What we need now is for the Trump team to review the issue, deal with the false allegations and put this issue behind us once and for all,” Sebright continued.

An amendment to take away a longstanding tax exemption for foreign airlines was removed from Donald Trump’s tax reform bill at the weekend. The proposal was included in the bill last month by Senator Johnny Isakson of Georgia, a state that Delta calls home.

Sebright shelved Senator Isakson’s amendment as “an attempt by US carrier Delta to destroy competition.”

The aviation industry last weekend lauded the news that the amendment had been removed, with Abdul Teffaha, secretary-general of the Arab Air Carriers Organization (AACO), proudly declaring that, “reason had prevailed”.

Abu Dhabi’s Etihad Airways said that the proposed tax “failed a broad set of international and US legal obligations and received almost universal opposition when its true purpose was revealed.”

The US-UAE Business Council functions as a facilitator for business relations between the two countries. Sebright has solid connections with Washington, having started his career as an intelligence officer in the Defense Intelligence Agency, serving in the Gulf, before moving on to work for former US defense secretary Donald Rumsfeld.

The organization has since grown from 80 member companies in 2015 to more than 150 companies today.

“The UAE is the nexus between East and West,” Sebright said. “Even despite [regional tensions], this place is still first choice for an American company coming to do business in the region.”

However, he cautioned that US businesses in the UAE have to be aware enough not to get caught up in “Trump rhetoric” about American jobs being moved abroad.

“Opening a new office in the UAE may mean tens of new jobs there, but the ensuing sales can represent hundreds if not thousands of new jobs back home. Companies must be careful to communicate this message,” he said.

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