Seeking foreign investment, Guangzhou Baiyun International Airport, one of the nation's leading aviation hubs, may have successfully lured a German firm as its first partner.

It is currently negotiating with Germany-based Fraport AG, owner and operator of Frankfurt airport.

Liu Zijing, president of Guangdong Airport Management Group Co Ltd, said it had talked with Fraport AG and both sides agreed to co-operate. Detailed plans are subject to further negotiation, he added.

Liu said Guangzhou Baiyun International Airport is wooing capital input for its second phase project initiated last year. It is also seeking to upgrade an advanced management system through its foreign partner to sharpen its competitive edge, he said.

The airport's second phase project involves investment of 17.5 billion yuan (US$2.16 billion).

Due to begin operation in 2010, the second phase of the airport has eight projects including a runway capable of accommodating the massive A380 aircraft, aprons, cargo terminals and a hub for FedEx.

Guangzhou Baiyun International Airport was planning to secure foreign investors as early as 2001; the government's decision to allow the local government to take over management of the airport made it feasible to seek foreign partners.

Management of the airport was entrusted to the Guangdong provincial government in 2004. Several overseas airport operators including those based in France, Singapore and Hong Kong, as well as Germany-based Lufthansa Airlines are reported to have approached Guangzhou airport since then.

According to Li Huiwu, deputy director of the Guangdong Development Research Centre, the State's policies encourage foreign investors to participate in the civil aviation sector. He said Guangzhou airport had every possibility of forging win-win co-operative ties with any foreign investor.

"No matter who the foreign investors are, I think Guangzhou airport will hold a dominant stake of over 50 per cent," the deputy director added.

Earlier this year, Airport Authority Hong Kong reached an agreement with the debt-ridden Zhuhai Airport, about 100 kilometres from Guangzhou, to charter the operation of the latter for 20 years at an annual price of over 200 million yuan (US$24.66 million).

Airport Authority Hong Kong will primarily use Zhuhai Airport for cargo business.

French Airport Group and Singapore's Changi Airport Group are among the most active pioneers in China's airport business.

The French Airport Group bought a 9.99 per cent stake in Beijing Capital International Airport as early as 2000; and Changi Airport teamed up with Guangzhou airport in a ground service joint venture in 1994.

Reliable sources said Guangzhou Baiyun International Airport had 129 airlines servicing 127 cities at home and abroad, five more than in 2005, with 37 airline companies operating flights to the airport, two more than in 2005.

The airport handled 12.5 million passengers in the first half of this year, up 13 per cent from a year ago.

Editor: Yan