CHINA Southern Airlines will boost its international network by launching about eight overseas routes this year.

"Now 19 percent of our income comes from international routes, and we aim to raise the figure to 25 percent or 30 percent in five years," the carrier's Chairman Liu Shaoyong said in Shanghai yesterday.

The Guangzhou-based airline is waiting for regulatory approval to open a route linking Beijing and London in the year's fourth quarter, Liu said.

He also suggested that the country set up a flagship airline merging the domestic operators, so they will be capable of competing with overseas rivals. However, he said "it's still not the right time" for such a move.

China Southern, the country's biggest carrier by fleet size, recently accelerated collaboration with other airlines to enhance its business. It signed a framework agreement with China Eastern Airlines in January to cooperate in several areas, including ground handling and operations as well as marketing and aircraft procurement. "Our cooperation will have substantial progress by the end of this year," Liu said.

The carrier also plans to open a cargo venture with Air France-KLM Group this year.

The carrier returned to profit in the first quarter as the yuan's appreciation offset disruptions caused by the worst snowstorms in 50 years. It made a net income of 796 million yuan (US$113 million) compared with a loss of 188 million yuan a year earlier under domestic accounting standards.

However, climbing oil prices remain a major concern.

"We spent an extra 9 billion yuan in recent years since the oil price nearly doubled, and last year, fuel accounted for 39 percent of total costs," Liu said.

Listed domestic carriers were dampened recently on concern that China's Development and Reform Commission may raise the fuel price by 1,200 yuan a ton by the end of this month to keep pace with international levels.

"I haven't received notice of this," Liu said. "And even if the commission really raises the fuel price, I believe it will reduce other fees, such as the tariff on imported fuel, to ease our burden."