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Gaston Browne ‘not prepared to give up’ on airline

by Marlon Madden
5 min read

Prime Minister of Antigua and Barbuda Gaston Browne is not prepared to give up just yet on the financially burdened airline LIAT, even as other shareholder governments have already voted in favour of its liquidation. In fact, the prime minister is moving to establish LIAT (2020) Ltd. to replace the ailing operation.

Browne made his position clear in a letter addressed to other major shareholder governments – Prime Minister of Barbados Mia Mottley, Prime Minister of Dominica Roosevelt Skerrit and Prime Minister of St Vincent and the Grenadines Ralph Gonsalves.

In the letter dated Thursday, July 2, he proposed that the group reconsider liquidating the airline and “reorganise” it instead.

At the same time, Browne has announced that “as a contingency arrangement” his government “intends to launch LIAT 2020 Ltd as early as possible” as a suitable replacement, should the other shareholders decide not to consider its reorganisation.

The Antigua and Barbuda leader said he deeply regretted that at a recent meeting of shareholders the group was unable to agree “on the importance to our regional integration project of maintaining the operations of LIAT 1974 Ltd, and to its further value as a feeder airline to transport tourists between the countries of the Caribbean”.

He expressed disappointment that a majority decision was made to liquidate the airline, with “no further discussion”, a step to which he objected.

“We, in Antigua and Barbuda, cannot abandon LIAT. LIAT did not abandon the Caribbean people. LIAT did not fail the region, it transported the region’s people safely for over six decades. It is those who undermined it, by encouraging transient profit-seekers in competition, that failed it,” said Browne.

“It is also troubling to my Government that shareholder governments in LIAT 1974 Ltd would decide by majority vote to liquidate the airline without putting in place any arrangements for meeting obligations to creditors and employees,” said the Antigua leader.

He explained that the expectation of creditors was that the regional governments would not renege on sovereign debt.

Browne said the creditors were now disadvantaged by the “failure” of shareholder governments to seek to negotiate with them reasonable terms for affordable repayment.

And with workers being laid off since the beginning of April without any form of compensation, Browne said: “A similar circumstance applies to the employees of LIAT who are all CARICOM nationals. Surely, it is the obligation of governments, particularly as shareholders of LIAT, and therefore, the employers of LIAT staff, to work out some form of negotiated compensation for them.”

Browne who broke the news on June 27 that LIAT was to be liquidated, said he remained convinced that the airline could be re-organised for the benefit of the region; to continue to provide the essential bridge between countries; to satisfy obligations, at least partially, to creditors and employees through negotiations and to turn the airline into a leaner, more efficient service that could be profitable.

“After all, in as much as LIAT 1974 Ltd has been saddled with many challenges, its loss was $12 million last year. A re-organised operation, efficiently managed, could turn around to produce modest profits,” he said.

“It is against this background that the Government of Antigua and Barbuda once again calls on the main shareholder Governments of LIAT 1974 Ltd to reconsider the decision to liquidate the airline and instead, to give meaningful consideration to re-organising it. We emphasise that a technical report already exists that could be the blueprint for deliberation of re-organisation,” he said.

In relation to Antigua registering the airline under a new name, Browne said his government has applied to do so and he called on the other shareholder governments to release the trademark to allow him to continue the process.

“In the meantime, we advise in full transparency, that the Government of Antigua and Barbuda has: (a) set aside $20 million to capitalize the company; (b) secured the serious commitment of other governments and private sector partners to take equity stakes, producing, so far, another $20 million; (c) put an expert team in place to produce a plan for a lean and efficient operation that would be profitable,” said Browne.

“Further, we extend an open invitation to all CARICOM governments, particularly the main shareholders of LIAT 1974 Ltd to participate in the ownership of LIAT 2020 Ltd,” he added.

Browne said he remained confident that a sustainable air bridge between countries in the Caribbean was critical to regional integration “in all its aspects”.

Recalling the start of LIAT some 64 years ago, Browne said it had provided an “essential bridge” between the people of the Caribbean.

“Indeed, it is true to say that LIAT’s challenges, including its operating losses, derived from its continuous battles to maintain aviation stability and sustainability for the Caribbean people against opportunistic rivals who abandoned the area when their ambitions to profit from it failed to materialize,” said Browne. marlonmadden@barbadostoday.bb

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