Korean Air and China’s Sinotrans Air Transportation Development yesterday agreed to set up a cargo venture company in China, reported the Korea Times.

Sinotrans Air Transportation Development is a subsidiary of Sinotrans, China’s largest logistics company established by the Chinese government.

The joint venture will operate in Chinese domestic, international airfreight transportation, and related businesses.

Korean Air Chairman and CEO Cho Yang-ho signed the contract with his counterpart in the Chinese company in Beijing yesterday. Korean Air staff will also take the posts of chief executive officer (CEO) and chief financial officer (CFO).

The venture company will begin operations in China in the second half of 2007 with three freighters.