The United States and Jamaica have agreed on the terms of a new air services agreement that significantly expands opportuntiies for low-cost scheduled and charter services to the Caribbean country.

The agreement, expected to be approved formally by both governments shortly, is the first in the Western Hemisphere to fulfill the objectives of the administration's procompetition international aviation policy.

Under the agreement:

Both countries can designate as many airlines as they want to fly to the other.

Airlines are free to determine their own fares without government intervention unless both governments agree to suspend a proposed fare. In the present climate the U.S. is unlikely to reject a proposal fare unless it is obviously predatory.

Charters operate in accordance with the rules of the country of origin of the charter traffic.

Both countries' airlines have the opportunity to fly nonstop into the territory of the other from an expanded number of cities.

Right now, Jamaican airlines are allowed to serve 5 specified cities in the United States. Under the new agreement, they will be accorded rights to serve 10 cities of their choosing, as well as 3 points from the U.S. into Canada and one city in Europe from San Juan if San Juan is picked as one of the 10 U.S. points. Jamaica will be able to change any of its 10 cities in intervals of not less than six months with 60 days' notice to the U.S. government.

U.S. airlines, which were limited to nonstop service from 10 U.S. continental cities plus Puerto Rico, the Virgin Islands and the Canal Zone, will be allowed to go nonstop to Jamaica from any city in the United States.