But in Asia the process has been slower to take root as national governments first have to let go of their grip on the region's airlines. At stake are billions of dollars lost each year in taxpayer subsidies, indirect costs to the region's tourism industry and even air safety. There's no doubt that governments across the region have begun to realize this. Many have started to dilute their stakes in their national carriers. But I think there is still a strongly rooted sense of territoriality in Asia.
People think a national airline is a symbol of their country.
Timothy Ross, an analyst at UBS Warburg in Hong Kong, says the industry is struggling with overcapacity. Every banana republic in the world has its own airline. It makes more sense to put resources elsewhere. Despite its apparent glamour, the airline business is pretty unattractive. That's less than half what U.S. carriers earn, and is lower than the return on money invested in U.S. Treasury bills, which have no life-threatening risks involved.