BEIJING wants Air China, China Eastern and China Southern to merge into one airline in a bid acquire 70 per cent of international air cargo from foreign carriers, but the move is also said to put the standing Cathay Pacific-Air China cargo deal at risk.

Cathay Pacific has said that its Air China deal is safe as it owns a 49 per cent stake of the Beijing-basedcarrier, will go ahead late summer, subject to regulatoryapproval, Reuters reports.

Beijing's hope is that a merger between the three big players of Air China, China Eastern and China Southern will grow the country's meagre 30 per cent share of international cargo with its remaining swallowed up by Air France, Lufthansa and Cargolux.

A further unnamed source claims the state-owned Assets Supervisions and Administration Commission will form a share-holding structure for the new cargo airline.