SHANGHAI: China Eastern is patching up its strained relationship with the Yunnan provincial government by committing to expand its presence in the home of some of China's most popular tourist attractions.

The agreement between China Eastern Air Holding Company, China Eastern's parent, and the State-owned Assets Supervision and Administration Commission (SASAC) of the Yunnan provincial government, calls for the establishment of a joint venture to further develop the air travel market in the southwestern province.

The Shanghai-based carrier will hold a 65 percent stake in the joint venture, with the Yunnan provincial government the balance. Financial details of the agreement have not been disclosed.