COMMENTARY: LIAT is vital. Make it viable

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LIAT Crew and Staff POS

(BTE Editorial)

Since 1956, Leeward Islands Air Transport, more commonly known now by its acronym, LIAT, has been as much a part of the Caribbean experience as cricket, carnivals and calypso. Yet, for much of that time, it has lurched from one crisis to another, and once again its fate currently hangs in the balance.

Following the 30th CARICOM inter-sessional summit held in February in St. Kitts and Nevis, it was revealed that the airline would require a cash injection of $10.8 million (US$5.4 million) to guarantee its survival.

The current financial dilemma in which the carrier has found itself has come about, according to Prime Minister of St. Vincent and the Grenadines, Dr.Ralph Gonsalves, because most of the countries that use its services have not responded favourably to the $5 million question.

Dr Gonsalves, who was at the time speaking on radio in Grenada, said that the Caribbean Development Bank currently owns three of the carrier’s ten airliners, bought by CDB funds and awaiting a decision on their future.

The Vincentian leader said: “We probably will have to ask the CDB to sell those three aircraft, but if we do that, immediately 33 pilots will have to go, then other workers including flight attendants etc., because over US$7 million is required in some immediate savings, with US$2.53 million required from the workers but we aren’t getting numbers anywhere near that.”

Regarding the reduction in workers’ pay, Gonsalves said: “We wanted a ten per cent cut across the board, but we are not getting that and the pilots agreed to a six per cent cut on the basic pay, which won’t do anything much.”

Dr Gonsalves added that CARICOM and the CDB held a consultation on LIAT two years ago, and three options were put forward: “A proposed restructuring of the airline, where countries served by LIAT have to come into the mix, workers take a salary cut, and the other stakeholders have to ‘chip in’. The second is to turn the airline completely over to the private sector, and the third would be to close it altogether and start a new venture.”

All of these options are seemingly on the table, including a proposal from Antigua and Barbuda’s Prime Minister Gaston Browne to buy out Barbados’ share in the airline, giving his country the majority stake. Grenada and St. Kitts and Nevis have agreed to contribute to the US$5 million request, and last week at a Cabinet meeting in Antigua, it was revealed that British billionaire Sir Richard Branson of Virgin Atlantic fame had expressed an interest in investing in LIAT.

The Antigua Observer quoted the Chief of Staff in the Antiguan Prime Minister’s Office, Lionel Hurst: “Sir Richard has proposed investing several million dollars in ‘wet-leasing’ several jet aircraft, which will fly from Fort Lauderdale to Jamaica, Haiti and then down into Antigua and Barbados. The whole idea is to enlarge LIAT, rather than collapse it or make it smaller. This would also allow the airline to fly to destinations outside of the Caribbean.”

But does this not defeat the whole purpose of LIAT? There are many smaller airlines all around the world which only travel between different parts of the same mainland, on one continent only or between islands in one archipelago. What need for LIAT to take on the JetBlues, American Airlines and British Airways of this world – the region already has Caribbean Airlines for that, which itself grew out of BWIA, another carrier that had its fair share of financial troubles.

While the funds owed presently would likely be “peanuts” to Sir Richard, and we could surely use his expertise on how to run a successful airline, perhaps the flamboyant billionaire already has his hands full with his new cruise line and his Virgin Galactic outer space travel venture.

But while Antigua and Barbuda’s checkered history of involving singular economic strongmen to set the course of a nation’s history is well established, that’s not the Barbadian way.

We urge the Mottley administration, which has been silent on the future of its shareholding, to declare its position.

We would strongly suggest that it maintains its stake in an airline that delivers thousands of Caribbean inter-island travellers to our shores and acts as a vital hub.

2 COMMENTS

  1. I actually believe that Barbados will not give up its shared in LIAT as is generally hoped by Antigua. Barbados sees and knows how vital LIAT is to it’s economic development. LIAT almost single handedly transport all OECS residents and others visiting the US Embassy in Barbados and it’s hotels also benefits. I think that both Barbados & Antigua looking for greater say and control of LIAT. Barbados wants LIAT Headquarters moved and a new board. Lets wait and see what happens.

  2. Well Audley, look at what happened.
    I know everyone will want to blame the pandemic, but COVID-19 was just really the excuse.
    If the Caribbean governments were really serious about Caribbean Integration and OECS and CARICOM they would NOT have allowed LIAT to fold. Not only did Barbados allow this to happen but they are actively doing things to be able to wash there hands of LIAT. The fact that the voted for liquidation and selling there shares for $1 is disgusting and sickening to any Caribbean national.
    Only PM Browne /Antigua is trying to save the airline.

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