The most profitable of China’s big-three airlines, Air China, has delivered a 57% surge in 2007 net earnings to CNY4.2 billion (US$593 million) on operating revenues of CNY49.7 billion (US$7 billion), up 14.6%. Foreign-exchange windfalls flattered the result, as has been common across the Chinese airline industry since the country began to let the yuan appreciate against the dollar in 2005. The yuan value of the airlines’ large dollar-denominated debt falls as the local currency rises, and the gain is booked as profit.

Australia will consider buying Boeing E/A-18G Growler electronic warfare aircraft following confirmation of its order for 24 of the standard two-seat version of the Super Hornet, the F/A-18F. In a review of air combat requirements, the Labor government now endorses the Super Hornet as “an excellent aircraft capable of meeting any known threat in the region,” even though Defense Minister Joel Fitzgibbon has spent months criticizing the hasty process in which the former Liberal National administration decided to buy it last year.

China Southern is pushing Beijing to bring the country’s big-three airlines, including itself, under a single state holding company. The proposal is sure to attract opposition from some elements of the government. Chairman Liu Shaoyong also says the government should get moving with a plan to recapitalize the airlines, and he adds that China Southern itself is hoping for 30 billion to 40 billion yuan (US$4.2 billion to $5.6 billion) in new capital.