JAKARTA, INDONESIA - SINGAPORE Airlines and Indonesian flag carrier Garuda signed a memorandum of understanding on code-sharing on Friday that will boost traffic between the two countries.

The agreement will see a new once-daily flight introduced on August 1 between Denpasar on the holiday island of Bali and Singapore's Changi Airport, the companies said in a statement.

Garuda would sell seats while Singapore airlines would operate the flight, which will be the fourth daily Singapore Airlines service between the two airports, the statement said.

The companies also agreed to a pro-rate agreement allowing customers to book flights through Garuda from Jakarta to Europe, China, India, Japan and Africa via Singapore. Garuda will operate the Jakarta-Singapore leg while Singapore Airlines will operate legs out of Singapore.

Singapore Airlines CEO Chew Choon Seng said the new agreement would boost overall traffic between Indonesia and Singapore and would set the basis for an expansion in the number of routes shared by the airlines.

'Although we start off the code share with just the fourth daily flight between Singapore and Denpasar, the scope of the agreement allows for us to expand beyond that,' he said. -- AFP