Governments Should Stay Out of Running Airlines-PM Skerrit

Dominica’s Prime Minister, Roosevelt Skerrit, has said he is open to investing in the new LIAT 2020 or any other airline providing services to the Caribbean region.

However, he emphasized that he does not believe that any government should be responsible for managing such a venture.

Instead, Skerrit said any new airline should be managed by private entities with the financial inputs of governments.

“Let us come together as the government and have a strategic plan for this airline and put in place good management, an executive chairman, and board members and let the government stay out of the running of the airlines. I don’t think governments should run anything. We should leave it to the private sector,” Skerrit said

His comments came in response to a recent announcement made by LIAT (1974) Limited, a regional airline owned by the governments of Antigua and Barbuda, Barbados, Dominica, St Vincent and the Grenadines, that the airline will permanently cease all commercial flying operations from January 24, 2024.

He believes governments must seek to underwrite a particular portion of the expenses of running these airlines.

Despite the public criticism, Dominica invested in LIAT, and Skerrit stated that Dominica is still willing to invest in any airline that serves the Caribbean.

“I have told Dominicans if LIAT doesn’t travel for one day we are in trouble in the Caribbean. I always believed that for any sustained airline business in the Caribbean to be serviced properly, the government must be involved. This is why I have invested in LIAT in the face of all the public criticism,” he said

He stressed that the Caribbean cannot grow without addressing interregional travel.

LIAT (1974) Limited has been under administration since July 24, 2020, and had been servicing several regional destinations before it entered administration.

In a recent announcement, the administrator of LIAT (1974) Ltd, Cleveland Seaforth, stated that the airline will cease all commercial flying operations on January 24, 2024.

This decision was made after careful consideration and evaluation of the present operations.

In a letter addressed to the staff, Seaforth mentioned that their employment with LIAT (1974) Limited (in administration) will be made redundant effective February 4, 2024.

The move is expected to affect more than 90 employees, who will be made redundant without any payment, with a promise that obligations will be met.

During the presentation of his country’s national budget last month, Prime Minister Gaston Browne stated that his government had embraced the responsibility to restructure and resurrect LIAT with a vision of returning the airline to the regional skies.

Browne also highlighted that LIAT has been an essential thread in the fabric of Caribbean connectivity, and hence it should be restored.

Furthermore, Browne mentioned that the Caribbean Development Bank (CDB), based in Barbados, would play a critical role in solidifying the arrangement among the governments.

He added that this would set the stage for finalizing the arrangement with Air Peace, a private Nigerian airline founded in 2013, to ensure LIAT 2020 can begin operations and secure a promising future for regional travel.

According to Browne, in 2024, the Antigua and Barbuda government will spend an estimated EC$30 million to ensure LIAT 2020 Ltd has all the aircraft needed and appropriate maintenance and operational arrangements are in place for the safe, reliable, and efficient delivery of service to the people of the region.

In Seaforth’s letter to the staff, he notified them that the company was not in a position to make any severance payments at this stage.

However, he indicated that the company would not relinquish its obligations to them on severance, vacation pay, retroactive pay, and any outstanding salaries.

Airline operator Air Peace has announced its intention to acquire a controlling stake in LIAT 2020, a new joint venture formed with the government of Antigua & Barbuda.

Under the agreement, both parties will invest in the venture with cash and other assets, with Air Peace becoming the majority shareholder.

The aim of this investment is to create a strong and reliable airline that can cater to the demand for inter-island connectivity in the Eastern Caribbean region, providing safe and efficient transport for both passengers and cargo throughout the area and beyond.