August 13, 2013

St Lucia on board as LIAT guarantor

St Lucia has joined the four shareholder governments of LIAT as a guarantor of the US$65 million borrowed from the Caribbean Development Bank (CDB) for the fleet modernization project of the regional airline.{{more}}

Chairman of the shareholder governments Dr Ralph Gonsalves told SEARCHLIGHT yesterday that the St Lucian government has agreed to guarantee US$5 million of the loan amount.

The government of St Vincent and the Grenadines is guaranteeing US$7.5 million of the US$65 million. The other three shareholder governments – Barbados, Antigua and Barbuda and Dominica are also providing guarantees.

The loan agreements provide for the loans to be on-lent to, and repaid by LIAT over a 13-year period at an interest rate of 3.95 per cent, following a grace period of two years.

Co-financing for the project is being provided by shareholder equity contributions and from the sale of LIAT’s existing aircraft.

The loans were approved by the Bank’s Board of Directors during a meeting at its headquarters in Barbados on July 18, 2013.

The Fleet Modernisation Project involves: the replacement of LIAT’s aging fleet through a combination of lease and purchase of aircraft; financing the transition costs associated with the changeover; the upgrade of maintenance facilities; and other institutional strengthening activities.