Chairman of the board of directors of the Barbados Tourism Marketing Inc. (BTMI) Alvin Jemmott has welcomed news by regional airline LIAT that it would remove the fuel surcharge, effective March 1, 2016, in light of lower oil prices.
Jemmott said he was glad to hear of the decision, which he said should be beneficial for the island’s tourism industry and allow more Caribbean tourists to visit.
In announcing the removal of the fuel surcharge on new tickets, LIAT’s Chief Executive Officer David Evans noted that oil was now trading at a 12-year low, ending a decade of high jet fuel costs, which had impacted ticket prices.
“I think it has two implications. It can either make airline travel around the Caribbean less expensive or it could very well serve as a catalyst to make LIAT more competitive,” Jemmott said.
“Either one I think will be a good thing for Barbados because the Caribbean is a very important region for Barbados. “It is sometimes floating between our third and fourth largest source market and it continues to be that way. So anything that is going to make an airline more competitive in the Caribbean it is a good thing for Barbados. And if it is going to make regional air travel better and less costly for the consumer I believe we will benefit from it as well,” he added.
However, Jemmott acknowledged there could possibly be “a flip side” to the decision, while quickly adding that he was certain LIAT officials “would have weighed the pros and cons and they would have been advised appropriately and made the right decision”.
A year ago LIAT announced a 50 per cent reduction of the fuel surcharge on tickets effective January 2015.
The airline first introduced a fuel surcharge in 2003, in the wake of increasing fuel prices. In 2009, when the prices went down, the company removed the fuel surcharge.
However, in 2011, LIAT re-introduced the fuel tax in response to months of spiraling fuel prices. That year alone, LIAT spent US$22 million on fuel, or 18 per cent of total costs. (MM)