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March 28, 2019

Trinidad Guardian:- St Vin­cent and the Grenadines Prime Min­is­ter Dr Ralph Gon­za­lves has hint­ed that Lee­ward Is­lands Air Trans­port (LI­AT) could drop Trinidad and To­ba­go from its sched­ule of routes as the air­line seeks to re­struc­ture amid fi­nan­cial bur­dens.

Gon­za­lves, who is al­so the Cari­com Lead among Heads of Gov­ern­ment for Trans­port (Mar­itime and Avi­a­tion), made the com­ment dur­ing an in­ter­view with WE FM in St Vin­cent and the Grenadines.

LI­AT is cur­rent­ly seek­ing an in­jec­tion of US$5.4 mil­lion to help keep the air­line in the sky and the mat­ter has been tak­en to Cari­com for as­sis­tance. But Gon­za­lves said so far on­ly Grena­da has re­spond­ed pos­i­tive­ly to a Min­i­mum Rev­enue Guar­an­tee (MRG) pro­pos­al.

“The oth­er gov­ern­ments of the Caribbean….on­ly Grena­da has said they will come aboard to pro­vide some emer­gency fund­ing and no­body else. Every­body is say­ing they agree the­o­ret­i­cal­ly for a min­i­mum guar­an­tee for the routes but they have not re­spond­ed pos­i­tive­ly, on­ly Grena­da alone,” Gon­za­lves said.

The MRG would rep­re­sent fund­ing by in­di­vid­ual coun­tries to en­sure LI­AT con­tin­ues to fly to their des­ti­na­tions. St Vin­cent and the Grenadines cur­rent­ly ac­counts for 52 LI­AT flights per week, Bar­ba­dos 116 flights and An­tigua 69 flights. St Lu­cia has flights with an av­er­age load fac­tor of 46 per cent while Trinidad has a 38 per cent load fac­tor.

Gon­za­les said these low load fac­tors mean that if St Lu­cia and T&T do not en­gage in the MRGs, it might be more ef­fec­tive to drop the routes in­stead of hav­ing the share­hold­er gov­ern­ments bear the bur­den of the air­line fly­ing to these coun­tries.

The air­line is owned by sev­en Caribbean gov­ern­ments, with the four ma­jor share­hold­ers be­ing Bar­ba­dos, An­tigua & Bar­bu­da, St Vin­cent and the Grenadines and Do­mini­ca.

Gon­za­lves said it might be eas­i­er to en­gage oth­er air­lines to sup­ply ser­vice to the T&T and St Lu­cia routes in­stead. He not­ed that with few­er routes, the air­line would not nec­es­sar­i­ly need to op­er­ate all of the 10 planes it cur­rent­ly owns and may sell three, there­by re­duc­ing the air­line’s debt-bur­den.

“Peo­ple don’t un­der­stand the mod­ern pe­ri­od of re­gion­al avi­a­tion. I am not fed up with LI­AT. I am stick­ing there with LI­AT, but it has to be a sub­stan­tial­ly re­struc­tured LI­AT and we have re­struc­tured in the past and there is no prob­lem in prin­ci­ple if you have to do a small sub­sidy in LI­AT, but clear­ly we alone can’t be bear­ing the bur­den,” he said.

LI­AT ser­vices T&T with 53 out­go­ing flights a week, fly­ing di­rect­ly to Grena­da, St Lu­cia, St Vin­cent and the Grenadines, Guyana, Bar­ba­dos and An­tigua and Bar­bu­da. It com­petes di­rect­ly with state-owned Caribbean Air­lines, which al­so serves the re­gion.

March 15 was the dead­line giv­en to 11 re­gion­al ter­ri­to­ries to re­spond to a re­quest from LI­AT for MRGs ear­li­er this month. So far, a re­quest from one of LI­AT’s share­hold­ers for Saint Lu­cia to in­ject US$600,000 in­to its op­er­a­tions has been part­ly re­ject­ed by Prime Min­is­ter Allen Chas­tanet. Chas­tanet said any fi­nan­cial as­sis­tance com­ing to the air­line from Saint Lu­cia must be con­di­tion­al, adding his gov­ern­ment would con­sid­er the re­quest if there is a sig­nif­i­cant re­struc­tur­ing of the air­line which is in the in­ter­est of the re­gion.

T&T’s Gov­ern­ment has not an­nounced a com­mit­ment to fund­ing but has in­stead of­fered a “func­tion­al co­op­er­a­tion” be­tween LI­AT and Caribbean Air­lines.

LI­AT has al­so been hold­ing meet­ings with its pi­lots with a view to cut­ting salaries to re­duce costs but so far the pi­lots’ as­so­ci­a­tion has re­ject­ed this sug­ges­tion.