BRIDGETOWN, Barbados, CMC – St Vincent and the Grenadines Prime Minister Dr. Ralph Gonsalves says the financially troubled regional airline, LIAT, will cut services to unprofitable routes.
“Those routes as I have said are social routes. If they (Caribbean governments) don’t help to fund them we will just cut them. It is as simple as that,” Gonsalves said at the end of a meeting of shareholder governments here.
He told reporters the Antigua-based airline is placed at a disadvantage as it competes with other airlines for market share in the region.
“It is an elementary point. You can’t be subsidizing or paying for other airlines to come into your space and your country and you just treat LIAT as just a floor mat and you take it for granted.
“No, no no, it can’t continue like that, but we are all in the integration movement together so we have to discuss it with them (regional governments) and see what favourable conclusions we could come to.”
The three shareholder governments are St. Vincent and the Grenadines, Antigua and Barbuda and Barbados, and Gonsalves, who is chairman of the grouping, said for instance, LIAT operates at a disadvantage when competing with the Trinidad-based Caribbean Airlines on the Trinidad to Barbados and Antigua route.
“We have to cut our fares on those routes in order to stay in the game with CAL. But when we cut our fares we are losing money but we have to be in the game because they are important routes.”
He said CAL was benefiting from a fuel subsidy that is contrary to 1996-97 CARICOM (Caribbean Community) Air Services agreement.
“All those are issues which we discussed and we are hoping to see some real positive action now,” he added.
LIAT has in the past called on regional governments to provide financial assistance to the airline as they do in relation to some international airlines in order to ensure tourist arrivals to their respective countries.
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