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Meet Vietstar, Vietnam's Next Airline?

Just in case you felt something was missing between Vietnam's straight-laced national carrier and the flurry of budget airlines that have stormed onto the aviation scene in recent years, Vietnam will soon be getting a new carrier.

According to Saigon Giai Phong, the Ministry of Transport is requesting approval of an air transport business license for Vietstar Airlines, a company established in 2010 which specializes in passenger and cargo transport as well as aircraft repair and maintenance, aviation fuel supply and pilot training.

Owned by the Vietnam Air Defense and Air Force under the Ministry of National Defense, Vietstar would become the country's newest passenger carrier, competing with other regional airlines on domestic routes as well as flights to ASEAN and north Asian destinations.

Vietstar plans to use Boeing 737 and Airbus 320 models in its first five years, reports the news outlet, though it is unclear how many will be put into rotation. By the end of 2015, Vietnam was home to 131 aircraft including 86 from Vietnam Airlines, 25 from VietJet and 11 from Jetstar Pacific.

For the moment, Vietstar's greatest hurdle is funding. As of this date last year, the company's registered capital amounted to VND800 billion (US$36 million), however government regulations require the company to raise an additional VND47.3 billion (US$2.1 million) in order to reach the minimum required capital for an international and domestic passenger and cargo carrier.

For its part, the Civil Aviation Authority of Vietnam (CAAV) is supportive of Vietstar's efforts, particularly as a cargo airline. Currently, Vietnam does not have a carrier specifically dedicated to cargo transport.

“CAAV will support Vietstar Airlines in exploring domestic and international routes, as well as in building a cargo carrier airline,” CAAV general director Lai Xuan Thanh told Saigon Giai Phong.

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