Already a common sight at Shanghai airport, Air New Zealand will soon launch its Beijing-Auckland service.

Already a common sight at Shanghai airport, Air New Zealand will soon launch its Beijing-Auckland service.

Setting up a business in China is not for the faint-hearted. Air New Zealand had people on the ground in Shanghai six years before its first plane landed, yet the multi-million dollar investment has been highly successful.

The numbers tell it all. China is New Zealand's fourth-largest source of international visitor numbers with more than 124,000 Chinese residents visiting the country in the March 2008 year.

They are not big spenders but the numbers are increasing as business, family and educational links between the two countries grow. Visitor numbers are expected to more than double in the next five years.

The New Zealand-China Free Trade Agreement is simply icing on an increasingly rich cake.

China is a bright spot for Air New Zealand in an increasingly gloomy international aviation market. The airline launched a direct, three-times-a-week service from Auckland to Shanghai in November 2006 and was says Air New Zealand chief executive Rob Fyfe, "enormously successful".

"We had to think about cargo and freezer flows as well as tourist flows," recalls Ed Sims, Air New Zealand group general manager international.

"We felt we could fill the belly-space doing Shanghai on a regular basis and that has proved to be the case.

"We have seen Qantas out of Australia in a third attempt to get a Shanghai service up and running."

It was the success of the service to Shanghai, China's commercial hub, that persuaded the airline to negotiate to fly direct to the Chinese capital. Its twice-weekly service between Beijing and Auckland starts in mid-July and will use the airline's new Boeing 777-200ER aircraft. The service will expand to three times a week from November.

The timing could not be better for Air New Zealand, coming on the heels of the signing of the FTA and with the Olympics in sight. The service will operate at the new dragon-shaped Terminal 3 of Beijing Capital International Airport alongside other Star Alliance members.

Sims admits that negotiating with China over landing rights was challenging.

"One of the first lessons we learned was the importance of reciprocity. If we were supportive of China, we found China was supportive of New Zealand."

This was especially the case over the issue of business visas. In theory, at least, Chinese businesspeople coming to New Zealand can obtain a visa within a week and New Zealand businesspeople going to China in a similar period. At busy times, however, there can be delays.