OPINION – Eastern Caribbean Governments should Relook LIAT's Possible Move to Barbados

liatCitizens and Residents of Montserrat must note with interest and concern the proposal to shift the base operations of LIAT from Antigua and Barbuda to Barbados, and for the reduction in inbound and out bound LIAT flights to and from Antigua and Barbuda.

Further, there are also emerging reports about a document authored by the CEO of LIAT that proposes to dissolution of LIAT whilst at the same time proposing that a Barbados air carrier be established with its own Air Operators Certificate (AOC) and Route Licensing Authorization.

While Montserrat has no direct interest in terms of shareholding and flight routes in LIAT, these developments at LIAT will have some implications for the citizens and residents and perhaps the economy of Montserrat.

As it stands currently, given the proximity of Antigua to Montserrat all regional passenger connections into and out of Montserrat pass through Antigua and Barbuda mostly via LIAT.  As such, if LIAT base of operations are going to be shifted from Antigua and Barbuda to Barbados and at the same time inbound and outbound flights reduced, then it also stands to reason that passenger movements and connections to and from Montserrat and indeed the entire Leeward Islands area will be affected. Further, the reduction the ability of passengers move and connect via Antigua and Barbuda will thwart any thrust by Montserrat to spur growth in regional tourism. The Government of Montserrat in particular needs to pay close attention to this situation, because any economic disruption in Antigua and Barbuda caused by the shifting of LIAT base of operations will have spill over effects in Montserrat given the proximity of the two countries and the historical, transportation and other socio economic linkages between the two countries.

On this basis, I will encourage the Government of Montserrat and also the neighboring Government of St Kitts and Nevis to openly and publicly express its solidarity with the Government of Antigua and Barbuda on the issue of LIAT.

The issue of LIAT seems to have taken on an insular nationalistic approach by the Government of some Caribbean Islands based on majority shareholding. If this is going to be the modus operandi of these Governments, then it may reach the point that the Governments of islands in the Leewards such as Antigua and Barbuda, St Kitts and Nevis and Montserrat may wish to reconsider their positions as it relates to regionalism and Caricom.

It is not surprising that there are recent reports that the losses at LIAT have tripled over the last few months. I have noted decisions taken by LIAT Management in recent times regarding flight routes which in my humble opinion make no business or economic sense.

For example, recently, LIAT Management decided to cancel its airline route from Antigua to Dominican Republic, which resulted in a number of Passengers travelling from Antigua and Barbuda, Montserrat, St Kitts and Nevis, St Maarten, BVI and Dominica travelling to the Dominican Republic and Haiti, being stranded in terms air transportation services. The same also resulted in open protest action in Antigua and Barbuda. This strange business decision was taken by LIAT at the time when the airline found its self in a natural monopoly position in terms of air transportation from the Leeward Islands area the Dominica Republic given the closure of American Eagle and the canceling of British Airways flights between Antigua and the Dominica Republic.

At the same time, LIAT made another strange business decision to institute flight routes between Dominica and St Maarten by- passing the Leeward Islands area hub in Antigua. This new route adoption by LIAT was taken despite the fact other airlines from the French Caribbean are flying that same route. To make matters worse, this new route between Dominica and St Maarten was instituted directly on the heels of the Dominica Government making a capital injection into LIAT.

Peter D. A. Queeley

Economic and Financial Analyst