Anthony calls for shake-up of LIAT

St Lucia has agreed to guarantee EC$3 million of loans for LIAT now undergoing a modernisation of its ageing fleet.

But Prime Minister Kenny Anthony also wants a rethink of how the airline does business.

"It's not just a matter of changing the chief executive officer, but dealing decisively with a problem in management that has been inherited over the years," said Anthony.

The airline, which last week had been forced to cancel many of its flights because of a strike by pilots, has been without a chief executive officer since Trinidadian Ian Brunton resigned in September.

Anthony, who is also the finance minister of St Lucia, said that there was also a need for a complete overhaul of the airline's business model and recommended a revision of its operations and logistics.

He said LIAT, which flies to more than 21 destinations daily, must reconsider the type of thinking that the only two bases it can have in the region are Antigua and Barbados.

"It has to rethink, for example, where is it in its best interest to have its maintenance facility. These are questions that loom very large and it can't any longer be a question of historic entitlements where Governments are putting money," said Anthony.

The airline's other four shareholder governments are Antigua & Barbuda, Barbados, Dominica, and St Vincent & the Grenadines.

The airline's shareholders in September secured a US$65m loan from the Caribbean Development Bank (CDB) to modernise the fleet.

LIAT said the agreements "provide for the loans to be on-lent to and repaid by LIAT" over 13 years, after a grace period of two years.

Anthony said that while his administration was lending support to the regional airline, it was doing so cautiously.

"We are prepared to agree to a guarantee," said the St Lucian leader.

"The reality is that it's not money up front which we are taking from the treasury and passing it on to LIAT. But, regardless, we have to be very careful because all the loans you take end up being ascribed to your GDP, because it becomes what is called a contingent liability," he said.

Anthony said that the guarantee comes with stipulations including the selection of routes which he contends should be market-driven.

"...We think that there have been some very bizarre routes. There have been instances where, for example, you fly past St Lucia to go to Barbados to pick up an aircraft from Barbados and then return to St Lucia," he said.

- CMC