Aviation

China's aviation industry is projected to expand five fold by 2026, at an annual growth rate of approximately 10%. The country will become the world's second largest aviation market and will require an additional 1,790 aircraft to handle the increased volume. Expansion of the airport infrastructure will also continue with 49 new airports slated for construction and 701 airport expansion projects. Furthermore, a new system of regional control centers and full conversion from program to radar based air traffic control will be introduced over the next 5-10 years. Annual growth rate for the next ten years is expected to reach 14%. By 2010, China expects to have 186 airports, including 3 national hubs, 7 regional hubs, 24 medium hubs, 28 medium airports and 124 small airports.

The General Administration of Civil Aviation of China (CAAC) has fostered mergers between the Big Three airlines (Air China, China Eastern and China Southern) and China's smaller, less profitable airlines. The CAAC is concentrating on expanding the number of smaller, single aisle aircraft while phasing out additional wide-body, twin aisle aircraft in the Chinese fleet. New agreements have also been signed to add cargo-carrying capacity to the three major Chinese airlines. With that capacity will come the need for better ground facilities to handle the additional cargo. China also plans to improve aviation security systems and equipment, computer information management, safety equipment, settlement ticketing systems, global distribution systems and E-commerce. The Big 3 are expected to seek foreign direct investment in order to satisfy some of these infrastructure upgrades.