KOREAN Air has predicted a 2007 operating profit increase of 14.3 per cent in an official statement to the Korea Exchange, based on cheaper fuel because of a stronger won, extended routes in China and emerging markets, according to a Reuters report.

"We plan to increase mid and short routes, which are more profitable, in Asia emerging markets, especially in China, as we regard the country as our second home," said Shin Jin-chul, a Korean Air spokesman.

Korean Air has already announced its intention to establish a joint venture cargo airline with China's Sinotrans Air Transportation to service China.

Korean Air, the world's top air cargo carrier, said it saw a KRW640 billion (US$690.5 million) in operating profit this year with sales up 3.6 per cent to KRW8.6 trillion.

Last year, the airline said it expects a KRW560 billion profit and KRW8.3 trillion in sales. In the third quarter 2006, Korean Air posted an 18 per cent fall in net profit on higher jet fuel costs.

Korean Air also said it was aiming to post KRW240 billion in pre-tax profit this year, up 33.3 per cent from last year's expected KRW180 billion, before foreign exchange conversions.