China Eastern Air Holding Company has signed an agreement for a joint venture with Yunnan State-owned Assets Supervision and Administration Commission of the Yunnan provincial government.

In cooperation with the government, the joint venture, formerly China Eastern's Yunnan Branch will gain advantages in many aspects, such as policy support, airport cooperation, project construction, and the ability to resist risks. The joint venture will become a regional hub and a network-based airline company.

In late May, Yunnan Branch of China Eastern took delivery of a new Boeing 737-700 and now the company's fleet has 37 aircraft. By 2010, the company will have 50 aircraft, the annual passenger traffic will increase from 6 million to 8 million.