On April 28, China Southern Airlines hosted a forum in the resort city of Sanya with senior management of SkyTeam as it reviewed its future membership in the global alliance.

Industry aviation leaders gathered in Sanya under the theme, "Industry Cooperation ... A Win-Win Future". Present and addressing at the forum were Mr. Li Jian, Vice Minister, General Administration of Civil Aviation of China (CAAC); Mr. Liu Shaoyong, President of China Southern Air Holding Company & Chairman of China Southern Airlines; Mr. Chen Gaoshun, Deputy Secretary General, Hainan Provincial People's Government; Mr. Gao Bohong, Vice Mayor, Sanya People's Government; Mr. Jung He Lee, President & COO of Korean Air; Mr. Dominique Party, Senior Vice President of International Affairs and Alliances, Air France; Mr. Liu Zoning, President, Guangdong Airport Management Corporation and Mr. Wang Xianping, Senior Advisor, China Southern Airlines.

SkyTeam is one of the three big global alliances, with current 10 member carriers in possession of 2,018 aircraft serving 14,615 daily flights to 728 destinations in 149 countries and regions. The SkyTeam alliance enjoys some of the world's best hubs and network, including Atlanta Airport - the world's largest airport where Delta Air Lines is based, Paris-Charles de Gaulle - the largest hub in Europe where Air France is headquartered, Incheon Airport - Asia's biggest airport where Korean Air is based and Mexico City Airport - the largest airport in the Latin American region where Aeromexico is hubbed.

China Southern Airlines is the largest airline in the People's Republic of China in terms of fleet, routes and annual passenger traffic and is the first mainland Chinese airline to launch its own self-created computer reservation system; sell China's first airline e-ticket and offer customers self-service check-in. Currently, China Southern is expediting the building of Guangzhou and Beijing as dual airline hubs to serve the ever-expanding Chinese domestic market.

China Southern has relocated its fleet of Airbus A330 aircraft to Beijing to serve the most extensive flights in mainland China.

China Southern Airlines signed an initial agreement for future SkyTeam membership in late August 2004, and in June 2006 China Southern inked a GAAAA (Global Airline Alliance Adherence Agreement) with SkyTeam, striding forward a key step towards a global airline alliance membership.

China Southern Airlines is aiming at becoming an official member of SkyTeam by the close of year 2007.

The Sanya forum will provide China Southern with the opportunity to communicate with varied domestic and international airline industry leaders in its preparation for its official membership into the SkyTeam.

Since signing the GAAAA last year, China Southern Airlines has been ramping up to significantly improve its varied service facilities, standards and procedures to meet membership requirements. This includes upgrades to its IT systems including seat reservations; departure control systems; Sky Pearl Club frequent flyer service; e-ticketing; bill and settlement systems; revamping its sales & marketing and retraining its staff under SkyTeam practices.

Mr. Yang Yuanyuan, CAAC Minister said, "Promoting the backbone Chinese carriers in joining global airline alliances is a main method of strengthening their international competitiveness. The Chinese aviation industry has to be exquisite in grasping the international trend to initiatively accommodate itself to the fierce global competition, making efforts in stepping into a strong civil aviation country."

Mr. Liu Shaoyong, Chairman, China Southern Airlines added, "Joining SkyTeam with such an extensive network is not only a positive move for China Southern Airlines but a significant benefit to customers, offering more choices in destinations and airfares. Passengers who select SkyTeam have a world of choices including 14,615 flights to 728 worldwide destinations. SkyTeam goes where 80% of world passengers want to go. Meanwhile, SkyTeam offers customers numerous fare options such as 'Around-The-World', 'Europe Pass', 'America Pass' and 'Asia Pass', allowing passengers to circle the globe via travel on any or all of SkyTeam members."

Mr. Jong Hee Lee, President and COO of Korean Air, welcomed the forum on behalf of SkyTeam and commented, "As a leading airline alliance, SkyTeam is well aware of the importance of China and its air travel market, which is why we are very proud to soon have China Southern as a partner in our SkyTeam alliance. We have no doubt that when China Southern's joining process is completed, it will add new momentum to the growth of both SkyTeam and the Chinese aviation industry."