Later this month, phase one of the long heralded Open Skies agreement will come into effect. Theoretically, the agreement deregulates the airline industries of the US and Europe. Plans are aimed at lowering flight costs, opening up airlines to foreign ownership, and the creation of new routes between Europe and the US. But, despite the magic lure of the agreement’s title, thick clouds are obscuring all of these targets.

You won’t notice a thing when you fly one of the world’s most hotly contested airline routes — Heathrow/New York — but on the ground beneath, a bitter row is developing between the people running the two continents connected by the route.

Open Skies will remain pretty much a theory only for the next few years. Vital deadlines that would trigger airline competition to new heights are being missed without any meaningful consequences. Virgin Atlantic, which a few weeks ago glamorously embarked on the world’s first biofuel propelled flight, announced at a recent New York news conference that new destinations in the US and Europe are not a priority, adding it wouldn’t pick any new destinations for at least another two years. The company isn’t even sure whether to urge manufacturers to speed up the delivery of the new Boeing Dreamliner; that’s how gloomy the prospects are. A company spokesperson termed phase one of the open skies agreement a “damp squib”. Ouch.

The row that’s brewing between the European Union and the United States is blamed on negative attitudes among top US officials, including President Bush and Vice President Dick Cheney. Jacques Barrot, the EU’s top airline official, charged the US is pushing for a set of ridiculous rules aimed to improve security. US authorities want EU aircraft flying to the US to hand over passenger lists, including the names of people who do not land on US soil; leading EU officials to believe this is clearly a tactic devised to impede the open skies agreement. The EU refuses to cooperate with the US demands, and threatens the Americans could face a ban if they don’t start carbon trading plans. Everybody involved is sitting the issue out until a new US administration takes place. “...attitudes are changing. Particularly with Bush and Cheney gone, there is a real hope of things moving on. The new administration will be under pressure to take new measures,” Barrot was quoted as saying in the Guardian newspaper recently.

Negotiations about Open Skies phase II officially resume later this month, but there will be few issues for constructive talk. To say that US air carriers’ landing rights are under threat in Europe is somewhat of an exaggeration because the deadline is set to 2011/2012. To even expect that what will materialize from these talks will be sourced by what’s on the table now testifies of ill-founded optimism.