By Caribbean News Global
ST JOHNS, Antigua – Prime Minister Gaston Browne in a letter to prime ministers of Barbados, Mia Mottley; Roosevelt Skerrit of Dominica; and Ralph Gonsalves of St Vincent and the Grenadines, expressed optimism and a reorganization plan for LIAT 1974 Ltd, following notification of the board of directors that the company is insolvent and needs liquidation, prime minister Browne was read to lead.
Following prime minister of St Vincent and the Grenadines Dr Ralph Gonsalves remarks [last April] that LIAT’s closure is imminent, Antigua and Barbuda was preparing to put forward strategic approach for LIAT. Browne went further stating, ‘All will be done to safeguard employment,’ adding that ‘there is [a] need for stability and certainty.’
Restructuring plans have come and gone, debt refinancing, much talked about strategic options and investors, meantime indecision and inaction have brought worsening conditions and Antigua and Barbuda is prepared to lead again – the powerhouse of the Caribbean.
During a virtual handing over ceremony on July 3, chair of the transportation portfolio in the CARICOM Quasi-Cabinet, and chairmanship of the Caribbean Community (CARICOM) prime minister Dr Ralph Gonsalves disclosed that six airlines have expressed interest to serve the gap that could be left in the wake of LIAT’s current challenges. They include SVG Air, One Caribbean, Caribbean Airlines (CAL), InterCaribbean Airlines, Silver Airways and Air Antilles.
“I believe we are going to be able to provide in a very short time a sufficiency of regional transport to serve the sub-region and ourselves safely, reliably, sustainably and reasonably priced. I want to give that assurance to the people of the Caribbean community,” Gonsalves said.
Meantime, Barbados prime minister Mia Mottley said: “A report which was compiled two weeks ago has shown 38 airlines are flying within the Caribbean community, nine of which come from outside. The remaining 29 are predominantly in the Northern Caribbean which means in the Southern Caribbean the greatest gap exists. LIAT has been a critical part of the region’s history in allowing Caribbean people to move, the airline is challenged,” Barbados prime minister Mottley advised.
“There also is a time when those instruments that served us well in the past might not be the right instruments for us going forward, she added, “heads of government have also agreed that those countries that are in a position to help stimulate air travel through the reduction of airline taxes should immediately reflect and see how they could revise so to do,” said the outgoing chair of CARICOM.
The Saint Lucia Labour Party (SLP) on Friday observed outgoing chair of CARICOM, that governments will be reviewing taxes on regional air travel as well as licensing of airlines.
“Regional air transportation has to be regarded as a public good and it is therefore incumbent upon all regional governments to accord it the attention that this implies. Further, the single market which CARICOM and the OECS have been building over the last decade should be accompanied by a single air space in order to give true meaning and success to the goal of the free movement of people, goods and services.”
“Despite all the financial difficulties and travails that have battered LIAT over the years, the airline has, without doubt, proven to be of immensely significant importance to the region. This is underscored by the current situation, in which, without LIAT, the people of the region are facing the alarming prospect of the impossibility of intra-regional travel, particularly in the Eastern Caribbean, in the months ahead, even as their governments are opening their borders after months of lockdown as a result of COVID-19. The value of LIAT cannot be seen in purely profit and loss terms,” the SLP statement said.
The opposition party called upon CARICOM, “to make a concerted and determined effort to finally put in place a workable structure for regional air transportation, whether or not this involves a remodelled LIAT, but that takes into account the objective realities of operating air services in a region of very small islands with their concomitant small populations.”
Last year faced a series of options in consideration over the worst financial crisis of LIAT existence, airline executives, governments and potential investors were in extensive discussions on business models, LIAT’s social and economic viability and air transportation in the wider region.
- St Vincent PM says LIAT closure imminent: Barbados PM seeks EIB funding
- Airline executives, governments, potential investors consider LIAT’s viability
Prime Minister of Dominica Roosevelt Skerrit has stated that the regional private sector and other stakeholders should consider ownership interest in LIAT and the continued development of the region.
“It is not enough to just say well LIAT is this, LIAT is that – come to the table. If you are not around the table it is going to be very difficult for you to influence the decisions,’ Skerrit said. ‘And so, if you are a party to the negotiations, if you are a party to something, then the ideas which you have can very well find themselves turn into decisions,” he said.
Last year, Central Bank of Barbados Cleviston Haynes told reporters:
“Such an airline has to be one that is economically viable. Clearly, our own financial situation and the financial situation of several of the other governments is not one in which one can continually have to inject funds into LIAT, and certainly, Barbados has had to inject substantial amounts of funds over the years in order to keep it afloat. I think the governments are really trying to find a more even approach to the financing of LIAT such that it can keep afloat and can continue to serve the various islands.
“Looking forward, Haynes’ concerns reflect the region’s wider economic viability with the buoyancy that LIAT shareholders will come up with the right solution and avoid adverse impact; he said: ‘At this stage, I feel optimistic that we will find a durable solution to the regional air transport problem…”
Prime Minister Browne has consistently “tabled strategic approaches on the way forward [for LIAT] and his government pledge to resist any collapse of LIAT and any move to re-create its replacement,” reaffirmed, “my government remains convinced that LIAT 1974 Ltd could be reorganised for the benefit of the Caribbean’s people; to continue to provide the essential bridge between our nations; to satisfy obligations, at least partially, to creditors and employees through negotiations; and to turn the airline into a leaner, more efficient service that could be profitable. He insisted: “As a contingency arrangement, should you decide not to consider the reorganisation of LIAT 1974 Ltd, the government of Antigua and Barbuda intends to launch LIAT 2020 Ltd as early as possible.”
David Jordan contends that “there are useful as well as successful adaptable business models, unbridled by political decisions which can be adopted. I think it is now opportune to change the policy direction and a new innovative business formula towards a successful operation if this trend continues to occur. How can one affect changes doing the same thing over and over again with the same tried management model? The plea is to invite a team of successful business owners from the regional private sector, to manage the airline with well-defined terms of reference — including the social need argument.”
Prime Minster Browne has the acumen to lead. He has shown consistency, competence and pragmatism on LIAT. Leading the powerhouse of the Caribbean, he is fortified with strong and precise direction that embodies the betterment of all. Given the odds and the urgency of now – LIAT 2020 Ltd is a natural and seamless fit – for the benefit of all.