Regional governments urged to invest in LIAT

3

Prime Minister Gaston Browne says efforts are being made to get the governments of at least four Caribbean countries to purchase shares within the financially-strapped regional airline. LIAT.

Speaking on a radio programme here over the last weekend, Browne, said that the issue had been discussed at the Caribbean Community (CARICOM) inter-sessional summit held in St. Kitts last week.

“The Caribbean Development Bank did a study some time last year in which they concluded that the most expensive option to pursue is to allow LIAT to collapse because we would have to form a new entity. That is just more expensive than having a restructuring of LIAT,” Browne said.

The major shareholders of the airline are Barbados, Antigua and Barbuda, St. Vincent and the Grenadines and Dominica and Browne said that there are plans to encourage the governments of St. Kitts-Nevis, St. Lucia, Grenada and Guyana to become shareholders.

“There is a need for us to have a model of shared burden, recognising that from time to time LIAT would need some level of support. We have recognised that LIAT is making a significant contribution, not only in terms of the connectivity of people within the region, but even the airport taxes, the landing charges and so on that are earned by the various governments,” Browne said.

“Even if LIAT was to collapse, LIAT would have to be replaced. We must be in a position to move people within the region. So If LIAT collapses you will have to re-invent it,” he said.

Last week, Browne had also indicated that LIAT is in debt to the CDB and that St. John’s was aware of the situation confronting Barbados, which is also facing a serious financial situation.

“I think what they are concerned about is taking on additional debt. LIAT has debt at the Caribbean Development Bank that is asking the four shareholder governments to take over. Antigua and Barbuda has readily agreed to assume US$16 million of that debt. I think Barbados is saying it has an IMF programme and there’s some difficulty, but I am pretty sure that in order to save LIAT they will go the extra mile and that they will take over their portion of the debt”.

Barbados last year entered into a US$290 million Extended Fund Facility (EFF) with the Washington-based financial institution aimed at turning around its ailing economy.

The Trinidad and Tobago government last week said while it would seek to help the cash-strapped regional airline by possibly entering into an agreement with the state-owned Caribbean Airlines (CAL) regarding the maintenance of its fleet, Port of Spain would not be injecting cash into the airline.

Prime Minister Dr. Keith Rowley said the regional leaders were informed that LIAT is in serious financial difficulties, “meaning within a matter of a fortnight an injection of a minimum of five million US dollars is needed in order to keep flying.

He told reporters that LIAT has enough “cash to last for 10 days “.

However, Browne told radio listeners “one of my colleague heads in the region made a very unfortunate statement recently in which he suggested that LIAT was 10 days away from collapse.

“That is not so. The reality is the various governments continue to support LIAT to ensure that it stays in the air. Perhaps someone may have made a statement, as far as I am concerned it was a hyperbole, not saying that without the support that LIAT could not collapse, but the reality is LIAT still has the support of the four shareholder governments and we will not allow it to collapse, unless circumstances push us   to the extent where we cannot take it any further,” Browne said.

The airline’s chief executive officer, Mrs. Julie Reifer-Jones, responding to reports that the airline is facing severe financial problems and could possibly be grounded in the coming days,  said that while the Antigua-based  airline is in a challenging financial situation, “LIAT has continued flying through the region with support from its principal shareholders”.

CLICK HERE TO JOIN OUR WHATSAPP GROUP

3 COMMENTS

  1. So after attempting to block a Trinidadian company from buying Scotiabank you want Trinidad to help you support a dead elephant?. Barbados cannot simply go and take on a burden when they are trying to vitalise their economy. Do you think the IMF are going to allow them to take on more debts?. The Antiguan government have squandered so much money over the years that they have allowed ST John’s and many other district on the Island to become dilapidated. They have no interest in fixing up anything so simply choose the lazy option of selling things off or allowing someone else to take over. Their CIP program netted over a Billion dollars but they have not used any if much of this money to gain back lost assets, clear debts or give tax payers value for money in infrastructure and services. LET LIAT GO!!. and stop filling your pockets on the people’s suffering!. IDIOT!!.

  2. Let LIAT collapse! Pretty soon another airline will fill the void. Time and time again we witness these so called leaders pumping monies into LIAT while management and the board of directors spend it like there is no tomorrow.

  3. These folks are learning from Donald Trump – El FatBoyo Presidente Marxist Dictator Gonsalves is claiming there is “fake news” circulating about the fake airport he built, and every few months the owners of LIAT manufacture a new crisis about needing more money for LIAT.

    Fact is, even if they got new shareholders there would still be a new financial crisis every six months needing – you guessed it – yes, even more money for the insane incompetents to pour down the LIAT black hole to “satisfy the Gods”. But don’t actually CHANGE anything, people, then there would be no political insanity for us to laugh at.

    On the subject of destinations “paying their fair share”, Caribbean Airlines serves our islands without multiple ownership or destination governments “paying their fair share”, WinAir serves our islands without multiple ownership or destination governments “paying their fair share”, interCaribbean now serves our islands without multiple ownership or destination governments “paying their fair share” – as do multiple other “regional” AND international airlines.

    How is it, then, that the supposedly intelligent (INSANE) eastern Caribbean political owners of LIAT are unable to wrap their supposedly intelligent minds around the concept of applying cost of operation to tickets, non-owner destination governments paying seat subsidies (AS THEY DO TO FOREIGN AIRLINES), and even doing the right things to transform the airline into a commercial operation which DOES NOT REQUIRE SUBVENTIONS?

    LIAT’s problems are nothing new, and over the decades the ever-changing faces of the owner politicians have had the same advice repeated from scores of stakeholders and aviation professionals (including Lufthansa), yet here we are with the political non-aviation non-airline talking heads in Barbados still just making it up as they go along.

    If majority shareholder Barbados is going to make changes, they should do so with professional advice, and not continue to waste everyone’s time and taxes playing irrelevant political games and asking the inmates what they should do next – the insane people in the LIAT asylum don’t know, THAT’s why they need more money.

    It is NOT necessary for ALL destination countries to invest and waste their taxpayer money in this failed airline model. Commercialise the airline, pull the politics and politicians completely out of it – AS HAS BEEN DONE AT WINAIR – impose reasonable fares, charge the losing destinations seat subsidies where necessary, and stop the decades-old utter amateur stupidity.

    The REAL problem is POLITICS, in politicians who believe that becoming elected dictators somehow endows them with knowledge and qualifications far surpassing every expert under the sun. Pull THAT dark matter out of LIAT’s backside and allow the professional light to shine on LIAT, and you WILL see an airline which expands beyond your wildest dreams. But as long as these dead weight sea anchors insist on dragging LIAT low in the water there will never be progress.

    So I suggest a new LIAT motto for the second millennium – “Backwards ever, forwards never!!”

Comments are closed.