Australian flag carrier Qantas Airways is planning to enter a fourth strategic alliance with Latam Airlines in a bid to boost its international business, particularly on the thriving Latin American market.

The Australian Financial Review reports that Qantas is eyeing a deal that could be just a broader code-sharing agreement to a profit-sharing scheme similar to its recently approved deal with Middle Eastern carrier Emirates.

Besides Emirates, Qantas has a strong presence in North American through alliances with American Airlines and in China via China Eastern.

Latam is the result of the takeover in 2012 by LAN of Chile over TAM of Brazil, creating the region's largest airline alliance. The Latam buy-in delayed talks with Qantas senior executives and negotiations are expected to last until 2014, said Simon Hickey, chief executive of Qantas International.

However, he admitted Qantas would have to convince regulators on both regions to give the green light to a joint venture between Qantas and Latam since the two air carriers are the dominant airlines in their respective areas.

So far, Qantas flies three 747 jets weekly from Sydney to Santiago, the capital of Chile while LAN offers daily trips between the two global cities via Auckland. Qantas stopped servicing the Sydney-Buenos Aires route in late 2011.

Qantas also signed a three-year partnership deal with the New South Wales government worth $30 million. The agreement would have the state government promoting the services of the flag carrier between Sydney and NSW.

NSW Premier Barry O'Farrell said the partnership with Qantas would boost NSW's economy and help create more jobs.

"Sydney is the gateway to Australia with more than 50 per cent of all international visitors to Australia arriving at Sydney Airport so it's fitting this is the largest partnership we have entered into with a state government," Qantas Chief Executive Alan Joyce said in a statement.

Qantas shifted its partnership with NSW after Mr Joyce's fallout with Tourism Australia - its former partner - over accusations that the tourism body's head, former Qantas Chief Executive Geoff Dixon, is allegedly attempting to destabilize Qantas.

The premier also rejected calls to build a second airport at Badgerys Creek even as Melbourne moves toward the construction of a second international gateway following the grant by Victoria of rights to the Philippines for the first international flight into Avalon Airport. Mr O'Farrell instead pushed for better use of the Sydney Airport.

Meanwhile, the Australian Competition and Consumer Commission (ACCC) approved on Tuesday the 60 per cent takeover of Tiger Airways Australia by Virgin Australia.

The ACCC gave its go signal after it found that the $35 million buy-in would likely not lead to a substantial decrease in competition in the Australian domestic air passenger market.

Tiger Airways, prior to the takeover, had posted losses in the past few years and has not recovered from the 2011 grounding of its fleet by the Civil Aviation Safety Authority. It has warned of closing operations if the ACCC would not approve the sale.

RELATED STORIES