Japan races back to Sars-free China

Celebrations marked the relaunch of Beijing's travel industry

Japanese businesses are rushing back to China, after the country was declared free of the Sars virus by the World Health Organisation (WHO).

Keeping out of the region has heavily dented revenues in a number of airlines and companies with businesses in the area.

Japan's second largest airline Nippon Airways said it would resume a full service to China on 11 July, while its larger rival Japan Airlines System said it was considering a return.

A number of companies, including the technology group NEC and camera maker Canon, are also beginning to relax travel restrictions, prompting a sigh of relief among local businesses.

Revenue slump

Nippon Airways' decision comes a day after the WHO decided to scrap its warning on travel to Beijing.

The move spelt good news for the airline which was forced to report a record annual loss for the year to March because of weak demand.

"Bookings have already started to pick up and we believe the impact of Sars is rapidly easing," said Yasuo Taki, a spokesman for Nippon Airways.

The airline plans to double its flights from Tokyo to Beijing and resume flights from Osaka to Beijing from 11 July.

However, there was no change to the company's profit forecast that Sars would wipe 26bn yen ($220.5m) from revenues for the year to March 2004.

Flight relief

The travel agency JTB resumed sales of package holidays to Beijing on Wednesday after a two month break, prompting suggestions that other travel groups will soon follow.

Recent reports have indicated that the Sars outbreak had a more damaging effect on the travel industry than the war in Iraq, with flights to China and the Asia Pacific region down by 45% in June.

Japanese trading house Marubeni said it had lifted restrictions on business trips to Hong Kong and Beijing and ended rules requiring employees who visit the areas to stay at home for 10 days.

"Voluntary restraints on business trips to Taiwan and Toronto will remain in place in principle," said Marubeni in a statement.