September 2, 2011
Gonsalves calls on regional governments to support LIAT

Prime Minister Dr. Ralph Gonsalves has indicated that 45 per cent of the routes traversed by regional airline LIAT have proved unproductive, and hinted that these routes may be dropped from the airline’s destinations if their governments fail to show support.{{more}}

The Prime Minister, also the chairman of the shareholders, during a press conference on Monday, August 29, at Cabinet Room, outlined what transpired at the LIAT shareholders meeting which took place in Barbados the week before.

He indicated that for the first half of 2011, the financial situation of the airline has deteriorated relative to last year, losing EC$21.5 million to date, citing a drop in passengers, lower fares and a rise in operating costs, as some of the reasons for the decline.

“Fuel, which constitutes 14 per cent of the overall expenses of LIAT… if the prices remain at the current levels, the fuel expenses for 2011 will be $16 million more than 2010.”

Dr. Gonsalves highlighted that the fuel cost for a number of routes which are not commercially viable exceeded more than $20 million dollars in 2010, and called on the authorities in those countries play a greater role in the sustainability of LIAT.

“Governments which are not shareholders; they have to realize that they gotta provide us with market support. If not, then we have to cut out what you call ‘social routes’ I don’t want to call the names of those ‘social routes’, but a lot of governments that criticize LIAT, who are not shareholder governments.”

“A lot of them (routes) are run, and at times, they don’t pay for themselves…. We have to pay landing fees of nearly $3 million in aggregate. We can’t continue like this, and other governments have to understand the facts of life.”

According to the Prime Minister, support given to the regional and international airlines should also be given to LIAT, which he called the ‘lifeblood of transportation in the region’.

He also called on the regional heads to come on board and to make their contributions to LIAT.

“….They would come and say they will get somebody to come in. Be our guests; get somebody to come in there; see if you can get there.”

“A lot of airlines have come and gone. They don’t last as long as ‘Miss Janey Fire’ and, of course, they come with all types of advantages; they battle LIAT’s bottom line, but LIAT has to still be there like the faithful mother-in- law who takes care of your children when you are out.”

“… There are some issues which the governments of the region have to come to terms with in relation to LIAT, otherwise we are not going to be able to operate on those social routes.”

LIAT currently operates in 22 destinations in the region.