The Cook Islands government says it welcomes new airlines applying for licenses, saying it will make domestic airfares more competitive.

A new airline, Kia Orana Air, has applied for a licence to compete with Air Rarotonga, as a passenger and freight service to the northern and southern group of islands.

Another licence is reportedly being sought by Pacific Air Expeditions.

Acting Civil Aviation Minister Wilkie Rasmussen says Kia Orana Air's application is being considered by the government, and says its fares could be up to half those offered by Air Rarotonga.

Mr Rasmussen says it's essential that the Cook Islands gets more air services, to bring fare prices down.

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