PHOTO: China Southern Airlines has sold a small share to American Airlines. (photo via Flickr/byeangel)
There are few untapped travel markets left in the world, especially for US-based passengers and businesses.
Cuba is one; China is another.
Which is the very reason why American Airlines just bought a stake in China Southern Airlines, the largest of the state-owned airlines in the People’s Republic of China.
The Chinese carrier announced it will sell a 2.76 percent share to American for $200 million, a co-op agreement that will include code-sharing and sharing of airport facilities, according to the Associated Press.
The deal, rumored for the last week or so, still requires regulatory approval.
So, what’s in it for American? Well, it’s easy to connect the dots.
China is the world’s most populous country, and it's experiencing booming growth in travel. According to the US Department of Commerce’s six-year forecast, released in November of 2016, the Asia Pacific region is expected to produce a 47 percent increase in visitors by 2021.
And guess who leads the way?
The Commerce Dept. says that between 2015 and 2021, visitors from China are expected to increase by a total of 3.1 million people, a 121 percent increase. That will give China the second largest number of visitors to the United States behind only Mexico.
According to the AP, China Southern says it operates more than 2,000 flights a day to 224 destinations in 40 countries and regions in Asia, Europe, North America and Africa. It says it carried 115 million passengers during 2016.
The partnership with American Airlines "is expected to provide continuous impetus for the company's long-term growth," said China Southern's announcement.
READ MORE: Delta Acquires Stake in China Eastern
The deal also gives American a chance to keep up with the Joneses, or, more specifically, the Deltas and Uniteds, when it comes to China.
Delta already has a small stake in China Eastern Airlines and United as a partnership with Air China.