C’bean gov’ts seek help from European Bank for regional transportation

Caribbean governments are looking towards securing financial assistance from the European Investment Bank (EIB) for the regional transportation sector amid concerns that shareholder governments may be forced to close down the cash-strapped regional airline, LIAT.

Prime Minister Mia Mottley, whose country is one of the four major shareholders of the Antigua-based airline, has confirmed that she has started discussions with the EIB on support for the region’s “transportation sector”.

While she did not name the struggling airline by name, she told reporters that during her recent visit to Canada and the United States, she met with the EIB Senior Vice President, Alexander Stubb adding that the European bank has expressed a willingness to assist with regional projects. “The EIB doesn’t only lend to the government, it also lends to private companies like the Barbados Light and Power in the past and it has also engaged here with not just national projects but also regional projects.

Her announcement comes in the wake of a statement by St Vincent and the Grenadines Prime Minister Dr Ralph Gonsalves, earlier this month that the regional carrier may be forced to close its operations after Caribbean governments appear reluctant to provide the necessary cash injection need to keep the airline flying.

Speaking on a Grenada Broadcasting Network (GBN) programme, Gonsalves said only Grenada so far had responded positively to the call for US$5.4 million to help the airline deal with its current financial problems.

Three of LIAT’s 10 planes are owned by the Barbados-based Caribbean Development Bank (CDB) that provided the funds to the regional government shareholders to purchase them while the seven others are leased.

Apart from Barbados, the other shareholder governments of LIAT are St Vincent and the Grenadines, Dominica and Antigua and Barbuda.

Earlier this month, LIAT said despite pilots and its workers across all its 15 destinations agreeing to a six per cent salary cut, the airline is still facing a severe financial problem and may require additional salary cuts from its employees.