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By Kenton Chance

KINGSTOWN, St. Vincent, Mar 30, CMC – St. Vincent and the Grenadines Prime Minister Dr. Ralph Gonsalves Monday warned against making unflattering statements about the regional airline, LIAT, saying it could undermine confidence in the business operations of cash-strapped carrier. St. Vincent and the Grenadines Prime Minister Dr. Ralph Gonsalves Monday warned against making unflattering statements about the regional airline, LIAT, saying it could undermine confidence in the business operations of

St. Vincent and the Grenadines Prime Minister Dr. Ralph Gonsalves Monday warned against making unflattering statements about the regional airline, LIAT, saying it could undermine confidence in the business operations of cash-strapped carrier.

“Everyone who is involved with LIAT, the shareholders, the directors, the management, the workers, everybody, has to be careful what they say and what they do in relation to this matter. It is a business, and anything anybody says or does, at any of these levels, could affect the confidence of the business,” said Gonsalves, who is the chair of the regional shareholder governments.

Gonsalves comments follow statements made on Sunday by Antigua and Barbuda Prime Minister Gaston Browne that he would treat as “treason’ plans for a new airline to compete with LIAT.

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Browne, speaking on a privately owned radio station said that he would also be seeking the resignation of the airline’s chief executive officer, David Evans, if the plans about the new carrier prove to be true.

The document, allegedly authored at LIAT senior management, proposes that a Barbados air carrier be established with its own Air Operators Certificate (AOC) and Route Licensing Authorisation.

The new company would effectively replace the majority of existing LIAT services throughout the region and would seek to develop new markets.

An approach, methodology and structure for the establishment of the new Barbados air carrier were detailed in the document.

It said a traditional approach to fleet planning in a startup airline with a projected requirement of 10 aircraft would be to launch initially with two to three aircraft and a limited route network and build thereafter incrementally over a period of 18 months to the final fleet number.

In his radio interview, Prime Minister Browne also called for a change in the chairmanship of the airline, saying he doesn’t “see why one prime minister should control the chairmanship of LIAT” and that it should be rotated.

“These are some of the issues affecting LIAT, I mean only one person has brains out of all of the shareholder governments. I am saying there ought to be changes at the level of the directorship, even in terms of the share holding positions of the various governments, I believe the shares of Barbados should be diluted because they believe because they have the majority shares that everything must move to Barbados,” he added.

Prime Minister Dr. Rlaph Gonsalves. (IWN file photo)
Prime Minister Dr. Rlaph Gonsalves. (IWN file photo)

LIAT is owned by the governments of Antigua and Barbuda, Barbados, Dominica and St. Vincent and the Grenadines.

Earlier the airline issued a one-paragraph statement indicating that it had been made aware of the comments by Prime Minister Browne and that “these matters are currently under discussion amongst the major shareholders”. Gonsalves told a news conference here that statements about the airline “can be demoralizing to the workers, to the management.

“In that context, I want to say that I have not received from any shareholder any information that they do not have confidence in the CEO or the management and I myself I have confidence in the CEO.

“Certainly, the chairman of the board of directors, who I spoke to, I happen to know that he has confidence in the CEO. So, I want to make those points clearly,” Gonsalves said.

Earlier this month, Prime Minister Browne said that his administration would resist efforts to shift the base of the regional airline, to Bridgetown and Gonsalves again defended the decision saying it was made based on the revenue generated and passenger load along LIAT’s routes.

“Now, it is public knowledge that the government of Antigua and Barbuda, through its prime minister, said that they want this restructuring decision to be put on hold. But until a shareholders’ meeting says that those decisions must be put on hold, the board and the management are obliged to carry out the decisions of the shareholders. And as chairman of the shareholders, I have received no request from anyone for a meeting of the shareholders,” he said.

Gonsalves, however, said he has received a letter asking that the decision to move the airline’s headquarters be put on hold.

“In the same way that I respect the good governance arrangements in St. Vincent and the Grenadines, I respect the good governance arrangements in a company. That’s the only way that things can be run in a proper manner. I am not saying that these decisions can’t be amended, altered, if other views are brought to the table and they are meritorious in all the circumstances.

“But, from the standpoint of St. Vincent and the Grenadines, as I had explained before, if I didn’t feel that they were decisions which were in the interest of the company, I would have demurred at that point of the shareholders meeting and to see if I can convince my colleagues of a different perspective.

“But there was no attempt by anybody to convince anyone of any perspective other than around this bundle of issues on which decisions were taken,” Gonsalves said, pointing out that St. Vincent and the Grenadine has paid its US$592,000 share of the five million dollar working capital the airline needs until a financing meeting with the Barbados-based Caribbean Development Bank (CDB) in May.

“I am hopeful that all the governments will make their payments,” Gonsalves said, adding that he understands that Dominica has paid, he didn’t know if Barbados had paid, but was “pretty sure” that Antigua and Barbuda was yet to pay.

“If the analysis [says] you need this money for the working capital and that is to carry you to the month of May, hoping you can get to the CDC board, any set of dissonance, whether it is by any shareholder, or any group of workers — be they the pilot or engineers or other workers who are neither pilots nor engineers — or the management, any dissonance in words or action can create a great difficulty,” Gonsalves said.

“This is a very serious matter which affects the social and economic wellbeing in this area and I am unable, constitutionally or otherwise, to embrace recklessness on this subject.

“And I hope that by reiteration of confidence in the management and the board and in the light of the decisions which were taken by the shareholders, that any alterations required, there is a process and there is a system for which any of these challenges can be appropriately addressed.

“What is certainly not appropriate is for important discussions to be held on this matter across the Caribbean Sea, which, whether intended or not, may have an effect of undermining confidence in the operations of the airlines,” Gonsalves said.

5 replies on “Public ‘dissonance’ could hurt confidence in LIAT — Gonsalves”

  1. To late Ralph! The confidence in LIAT has deteriorated years ago. You were the one who said it was a welfare case.

  2. vincentian 514 says:

    Why must we as a people keep silent about the lack listing airline that is more unreliable than it ever was, maybe what we really need is competition that always make get things going in the right direction , also it benefits the consumer as well.

  3. C. ben-David says:

    Dr. Gonsalves assertion that LIAT “is a business” is false. Hardly anything that governments own, control, and manage in the Caribbean or elsewhere is done in an efficient business-like — i.e., capitalistic, profit-oriented, competitive — fashion.

    The main problem with LIAT is the same problem that has been faced — and largely solved by countries all over the world — is that it is government company. Privatization has worked all over the world in turning economically basket-case airlines into prosperous companies actually owned by shareholding citizens.

    Privatization may be exactly what CEO, David Evans, is trying to accomplish because nothing else has worked. But it must be competitive privatization in which there has to be checks and balances preventing private-sector monopolization which would be only a little better than the statist monopolization we now have.

    As for the grandstanding by the PM of Antigua, the rest of the shareholder should just tell him to go piss up a rope.

  4. I disagree completely , Comrade Ralph. As _ANY_one will tell you, public confidence in LIAT faded a long time ago. And any confidence that remained disappeared in the “meltdown” late in 2013. Passengers up and down the islands are frantic for alternatives – and I assure you alternatives are already on the way, it just takes time.

    Let us be very clear about LIAT’s problems: they all emanate from the top. Yes, Comrade, from you – a minority shareholder calling all the shots who does not NEED LIAT.

    And from Comrade Freundel, another who does not NEED LIAT.

    The source of problems then go down through a politically appointed – and apparently untouchable and immovable – Teflon Board, who – judging by their performance over the years – clearly know NOTHING worthwhile about aviation.

    And even further down through executives chosen because of who they know or – as evidenced in the recent CEO selection – how little they know about the job at hand. Was Evans also required to sign a paper stating that he would not implement any changes whatsoever?

    Let us back up for a moment. The LIAT Board chose as the airline’s previous new leader a former CEO of an airline which had as its mandate from its one shareholder to take over LIAT. Strike one.

    Then they warmly received his proposal and presentation to perform a fleet change. Strike two.

    Then they went ahead and swallowed that bait hook, line and sinker. Strike three.

    And then you were out… the Trojan Horse was pulled inside the gates, and while you shareholders slept safe in your beds the Trojan Armies exited inside the citadel and put it to the torch.

    Why do I criticise this? Because if even ONE of those Board Mambers knew the basics about aviation management today there would have been some homework done AND questions asked of real experts, and it would have been revealed that the cost to LIAT would not be US$100 million but closer to US$250 million. It would also have been revealed that the new ATRs which were being promoted did not use less fuel that the Dash-8s, they used the same fuel per hour because of the uprated engines.

    So in their supreme ignorance the Board swallowed the proposal that the ATRs would also cost less on maintenance supplied by the manufacturer for a period of X years. Did anyone calculate what it would cost to retrain over 100 pilots and about 50 engineers? Did anyone figure out what ELSE the fleet change would cost?

    Then the new CEO added insult to injury, refused all advice about available pilots and calls for caution and went ahead to cause a “meltdown” of the airline, stranding thousands upon thousands of passengers across the system – while taking one of the new aircraft out of passenger service to operate a charter for a visiting politician. Hey, charter a small jet and take His Majesty where he wants to go, don’t strand thousands for one pompous political ass.

    No, Comrade, the problem with LIAT is a c\COMPLETE LACK of aviation competence at the top.

    How manjy times has this airline ground almost to a halt, chaos ensued, and the Chairman sails out of the billowing smoke with whilte sails clean as a new-born babe? Does Chairman Holder have NO responsibility for LIAT’s performance? Eminent citizens across LIAT’s network have repeatedly called for Holder’s resignation, but he still sits there, with that silly smug look on his fat face. What is special about Comrade Jean, Mr. Prime Minister?

    Another incompetent sat in the your Board meeting and said nothing about the decision to move LIAT to Barbados. As a former Minister of Aviation he should have FULLY understood the ramifications of such a decision, yet he said nothing until he returned home to whine to his Prime Minister.

    While LIAT grinds to a halt – yet again – there are cracks appearing in other areas, such as CARICOM. Personally, I suggest you look around again and see whether there is some other solution for LIAT than your usual rudeness and bluster. You are a politician – you are supposed to be an expert on compromise. Or does that not work at all where you come from?

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