Wednesday, 12 March 2014

LIAT taking a different route

Chairman of challenged regional air carrier LIAT, Dr. Jean Holder, says that the airline has been tirelessly trying to persuade more regional governments to assist in footing its burdensome bills, particularly governments of those countries whose routes are considered by LIAT to be unprofitable.

According to him, however, the route of persuasion has run its course and the company must now take what he referred to as “decisive action”.

Chair of LIAT shareholder governments, Prime Minister of
St. Vincent and the Grenadines, Dr. Ralph Gonsalves (right),
discusses steps LIAT needs to take to reach a more stable
financial position, while Barbados Prime Minister
Freundel Stuart (centre) and LIAT's Chairman Dr. Jean Holder,
listen at a press conference last Thursday at Hilton Barbados.
It was back in October 2012 that then CEO of LIAT, Ian Brunton, had announced during a regional tourism summit in St. Kitts that the airlines “will soon be dropping at least eight routes” which had proven to be consistently unprofitable, unless the carrier could secure some kind of  support from affected governments.

When questioned why to date LIAT’s management was still fumbling around with an “intention” to take decisive action against such governments, particularly given the challenges of summer 2013 and a re-fleeting programme that has been going through some teething problems, Dr. Holder acknowledged that the management of the company had been remiss, but had been hoping to persuade countries to put in money.

“We have been trying, before going the harsh route, to persuade people to invest. We have met with a number of governments and Prime Ministers... we have expressed to them that we will have no other option but to cut the service. I think we have reached the point, after a lot of challenges, where we need to do as we say that we will do. That may after all be more effective than the persuasion route,” Dr. Holder remarked.

He said that the company has taking the stance that it needs to be more professional and implement the changes needed to keep the airline on an even keel.

Prime Minister of St. Vincent and the Grenadines, Dr. Ralph Gonsalves, also stated that in his capacity as Chairman of Shareholder Governments, he had been putting public pressure on his counterparts across the region, for example in St. Lucia and St. Kitts – countries that benefit considerably from the carrier but assisted in no way financially to keep it in the skies.

“We’ve not been putting the same pressure on Dr. Keith Mitchell of Grenada because I know he has just come into office... and is trying to sort himself out... We give him a break, but he too has to come to the table...” said Dr. Gonsalves.

When asked if he felt that prolonged economic challenges in the region would make it even more difficult to solicit funds from these governments, the St. Vincent Prime Minister argued strongly that
existing contributing countries were not immune to the ravages of the global economic meltdown but, since 2008, had been demonstrating their commitment to the region.

“Despite the stresses and strains, we have come up with significant monies and I am sure that that is a factor which some governments, who have not put in, will bear in mind. But I also think that because some governments have [received] a free ride for such a long time... it’s always better for someone to have a free ride that for them to pay for the ride,” Dr. Gonsalves responded. (RS)

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