The shareholder governments – Antigua and Barbuda, Barbados, Dominica, Grenada and St Vincent & the Grenadines – met on Saturday to decide the future of the carrier, with Prime Minister Gaston Browne, confirming on local media afterward that the preliminary decision was to liquidate the company.
“The survivability of LIAT is questionable. From all indications, LIAT (1974) Limited is likely to be liquidated. In fact, there will be an annual general meeting of the shareholders to determine the fate of LIAT.
“Antigua and Barbuda’s position is that, whereas we recognise that the four shareholding governments cannot carry LIAT presently…the losses would have increased exponentially, which means that LIAT – which was always in a very precarious position – is literally now inviable. A decision will have to be made potentially to collapse it and then maybe, countries within the region will have to come together to form a new entity,” Browne said.
Speaking on Observer yesterday, leader of one of the other shareholder governments, St Vincent & the Grenadines Prime Minister, Dr Ralph Gonsalves, shared similar sentiments.
“LIAT is going to be put into liquidation. The four major shareholders [on Saturday] received a recommendation from LIAT’s board of directors and we got a summary report. The relevant notices under the law in Antigua will go out, we’ll have this meeting and I have no doubt that the process of liquidation will be proceeded with,” Dr Gonsalves stated.
Amid the discussions ahead of the next shareholder meeting is the potential impact on the hundreds of workers employed with the carrier. On this issue, Dr Gonsalves explained that the severance payments that could be owed to LIAT workers is significantly high.
“The truth of the matter, the unfortunate thing is that LIAT doesn’t have any assets to talk about to satisfy any set of liabilities, including about EC$80-something million worth of severance payments. [For] the workers in Antigua alone, the severance payments are [worth] about $62 million based on the collective bargaining agreement, so it’s big money. [Then], there’s another $10 million or so owed in holiday pay across the LIAT network,” Dr Gonsalves disclosed.
He lamented the position of Prime Minister Browne, expressing, “My partner Gaston has a tough issue on his hands, because nearly 400 employees out of the 600-plus are based in Antigua. It’s a big industry in Antigua [and] it’s a hell of a blow.”
He maintained too, that there is no other option at this point, than to liquidate the company. “There is no other solution. Barbados has made it plain that it has no money to put in and other places are having it very difficult, so there it is, we have to move on,” he said.
Dr Gonsalves also explained that there needs to be a discussion about the options within the region for possibly, a new airline and importantly, what can be done in the short term to maintain travel throughout the sub-region.
“There are some pre-liquidation costs of about $10 million which will have to be dealt with. There are lots of issues, but in the meanwhile, we have to see how people can move. We’re trying to see if we can have a CARICOM-wide meeting…I don’t know what the appetite is across the region – for anything new – so I have to begin with what exists.
“We have CAL (Caribbean Airlines) in Trinidad, we have One Caribbean and we have SVG Air. There’s a group out of Turks and Caicos, they do a lot in the northern region, they come down to Antigua [and] I think they probably reach as far as Dominica.
“We’ll see what assets there are and see what’s the best we can make of these things in the short term, while persons gather steam, to see if they will have another airline. I see my brother Gaston [Browne] is interested in something continuing with the name LIAT…but I have to begin to think about moving people tomorrow morning,” Dr Gonsalves added.
According to Dr Gonsalves, present at Saturday’s crunch meeting were the shareholder governments, along with the Caribbean Development Bank (CDB), the Chairman of LIAT’s Board of Directors, Professor Owen Arthur and the management of LIAT. Observer also contacted LIAT CEO, Julie Reifer-Jones yesterday regarding the outcome of Saturday’s meeting, but her only words were, “I have no comment at this time.”
Source :Antigua observer