Cathay Pacific Airways has announced it has reached an agreement with Airport Authority Hong Kong (AAHK) to delay the completion of its new cargo terminal by up to two years to mid-2013. The terminal had originally been scheduled for opening in the second half of 2011. Cathay said the decision “was taken in response to market conditions brought about by the global economic downturn” and that it is aimed at “better matching supply and demand in the airfreight business given the current market outlook.” It has suffered from a steep decline in freight traffic and on Tuesday warned its cargo and mail traffic dived nearly a quarter in December on weak demand from China, while passenger numbers fell slightly. The carrier said the first quarter of 2009 will be weak, and revised its cargo capacity to Europe and North America downwards. “The deferral is aimed at better matching supply and demand in the airfreight business given the current market outlook. It is also important for the company to maintain a strong balance sheet until the market strengthens,” it said in a statement The carrier said it remains “fully committed” to the eventual completion of Hong Kong’s third cargo terminal and that it will compensate AAHK for the delay.