Local Banker recommends LIAT service be withdrawn from Caribbean Countries that don’t contribute to it
‘Barbados TODAY’ reports that a Local Banker has recommended that LIAT services be withdrawn from Caribbean Countries that don’t pay their dues or are not contributing cash to the Airline. That local banker was reportedly instrumental in raising nearly BDS$50 million through a regional bond issue, to ensure LIAT’s survival over ten (10) years ago.
“The easiest thing for LIAT or any airline company to do is to say, ‘I am cutting that route’. If you cut the route to Dominica, for example, what will happen?” former president of the Barbados Bankers Association Horace Cobham said. At present, only Antigua & Barbuda, Barbados, Dominica and St Vincent & the Grenadines are said to be contributing financially to cash-strapped LIAT. Some Caribbean leaders, including Dr Keith Mitchell of Grenada and Dr Timothy Harris of St Kitts & Nevis made it clear they will not invest in LIAT. St Lucian PM Allen Chastanet also recently made it clear that his country would not put a dollar into the regional airline.
Cobham told Barbados TODAY some tough decisions would have to be taken, if LIAT were to be made into a viable entity. Among those decisions, he said, was to stop serving the countries that did not contribute financially. He said “Some routes aren’t commercially viable. So if you are saying at the political level we need LIAT to fly there, then you will have to pay for it, and that is where the problem exists in LIAT. Because it is called a Caribbean airline, they feel that it has to fly there, even if it has just ten people, and if you don’t fly there, the politicians will get up in arms”.
Cobham says LIAT was playing an important role in Caribbean aviation, and was “not something you can get rid of”. However, the former CIBC and Royal Bank executive told Barbados TODAY, the airline needed to improve its internal operational structures, and hold management accountable. He feels that the airline was doing well on the revenue side, but needed to address its expenditure.
“LIAT should always be commercially viable. So once you start with that premise, then the other things will fall in line. Commercially viable does not mean charging whatever you like, and have all sorts of internal leakages that burn money. “Force LIAT to have the right organizational structure, the right fleet structure, and the right hub structure,” he advised.
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