Vietnam’s government has approved the establishment of the country’s first privately owned carrier, setting an important precedent in a market that is forecast to continue growing rapidly in the coming years.

The government at the end of November said it had approved the aviation license application of Vietjet. The new low-cost carrier will be based in Hanoi and will have a secondary base in Ho Chi Minh City. It plans to launch operations late in 2008 or early in 2009 and will use either Airbus A320s or Boeing 737-800s.