While the ink has barely dried on Australia’s landmark ‘open skies’ agreement with the United States, its promise of greater choice and lower fares has already become a reality following Virgin Blue’s announcement today that it will start flying regular services to and from the US by the end of the year.

The US is the third most popular destination for Australian tourists, and the ‘open skies’ agreement allows Australian and US airlines to increase flights, develop new routes, offer innovative products and grow their businesses free from government interference.

I am particular pleased that Virgin Blue is moving quickly to take advantage of the new arrangements successfully negotiated by the Rudd Labor Government only a month ago.

The Australian Government welcomes the airline’s decision to enter the long haul international market through its new carrier – V Australia – and wishes Sir Richard Branson and his team every success as they embark on this ambitious endeavour.

V Australia’s entry will provide travellers with greater options, put pressure on ticket prices and create new jobs in our aviation and tourism industries.

But without the ‘open skies’ agreement, it would not have been possible for V Australia to commence operations with its desired number of services.

The Rudd Labor Government is committed to the further liberalisation of the international aviation market as the best way to keep fares affordable as well as give both new and existing airlines the confidence to invest in additional aircraft.

Ultimately, greater competition is good for travellers, jobs and the economy, particularly for a relatively remote island nation like Australia.

Already our aviation sector supports thousands of jobs and creates billions of dollars in exports. Equally, a thriving, competitive aviation sector helps satisfy the hunger many Australians have for travelling and doing business overseas.

Last year, Australians took 5.5 million trips aboard and at any one time there are more than one million Australians living and working overseas.