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CIA says RAC deal is in air

C AMBODIA International Airways (CIA) has announced it has entered into talks

with the government over the resurrection of Royal Air Cambodge (RAC).

A

CIA spokeswoman, who declined to be named, said: "There has been a meeting

between Co-Prime Minister Ranarridh and the management to discusss CIA

participating in the creation of Royal Air Cambodge.

"CIA will also be

responsible for the upgrading of airport facilities. We hope there will be

long-haul flights to the US and Europe on wide body jets soon.

"We cannot

yet say whether this will be carried out in cooperation with other airlines or

if it will simply mean that CIA will be renamed Royal Air Cambodge.

"But

in making this press release the management is demonstrating its confidence that

something concrete is going to happen."

RAC, originally conceived as a

joint venture between the government and Singapore International Airlines (SIA),

was due to have begun flights today as a new national flag carrier.

But

last month SIA said the deal was shelved indefinitely due to political

instability in Cambodia.

SIA had demanded that CIA and SK Air/Kampuchea

Airlines cease operations so RAC could have a monopoly on Cambodia's seat quotas

in bilateral agreements with other countries. This lead to fears of large

increases in fares.

Kampuchea Airlines is preparing to launch new

international routes after taking over all flight operations from its Thai

partner SK Air, which has now solely become a ticketing agent.

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