St Lucia Economist Says ‘Let Successful Business Gurus Manage LIAT’

Saint Lucia Times – Former Director of International Trade and Investment in the Saint Lucia Government service, David Jordan, has said that the most recent public pronouncements of both the current Prime Minister and the Leader of the Opposition of Saint Lucia on loss-making regional airline, LIAT, offer nothing innovate to ensure success and viability of the carrier.

“Their statements, to say the least, are on parallel paths,” Jordan, a UWI and Columbia University trained Economist, said in a statement to St Lucia Times.

He asserted that the woes of LIAT are perennial as espoused from one political administration or opposition to the next in the Caribbean islands serving as shareholder Government of LIAT.

With change of political administrations in the islands, one only witnesses “landing rights wars” if not landing inducements tactics, price increases of airport taxes and airline tickets which continue to be characteristic of regional air travel in the respective territories, according to Jordan.

The Economic Policy specialist proposes that “the mantle of innovative action and management should be extended to the private sector of the region.”

Jordan is of the opinion that a select group of highly successful business people in the Caribbean region ought to be the directorate of the airline, in preference to politicians.

“There are useful as well as successful adaptable business models, unbridled by political decisions which can be adopted.   It is a shame that the only publicized rhetoric that the Caribbean public is accustomed to hear is the financial woes of LIAT,” he remarked.

Noting that in most countries where LIAT services regional travel is of critical importance, the Economic Police Specialist said he cannot recall hearing of financial accountability an important element or practically seeing Financial Statements being publicized, published or known to the general public so that the learned could analyse those Financial Statements and offer guidance and or comment.

“One continuously hears of the intermittent crisis situations warranting supposed financial bailouts,” Jordan observed.

“At this time, it is the ‘pilots making a sacrifice for a ten percent salary cut to save the airline’ while earlier this year, there was a desperate call for ‘five million dollars from supporting Governments’,” he recalled.

“I think it is now opportune to change the Policy direction and adopt a new Innovative business formula towards a successful operation if this trend continues to occur. How can one effect changes doing the same thing over and over again with same tried management model?  The plea is to invite a team of successful business owners from the regional private sector to manage the airline with a well-defined Terms of Reference – including the ‘social need’ argument,” Jordan said in his statement.

He noted that while the region needs LIAT as a reliable airline to facilitate regional travel, there must be a successful formula of innovation that resides in the ethic and psyche of successful businesspersons in the region which can be adapted to ensure the success of the airline.

Innovation that can be adopted to eliminate the “financial waste and losses” which have been managed by the politicians in the history of the airline,” Jordan asserted.

He expressed the view that there will be a difference to the operations of LIAT should this new approach be adopted such that the importance of LIAT will be explored from several spheres including the movement of goods.

According to Jordan, the beneficiaries of a LIAT service need efficiency, price affordability and safety as well as financial accountability.

He warned however that while hoteliers should offer advice, they should never be involved as directors in the new model.

“Hoteliers rely too much on the culture of incentives and subsidies. Governments’ role should be emphasized as a facilitator of the enabling regional environment, adopting policy of a uniform and identical stance across the region where LIAT flies” to support the private sector run LIAT– defined as not being airline political managers,” Jordan stated.

He made it clear that there are glaring issues which ought to be addressed, including the high airfares in the region that deter travel.

“Too many Caribbean nationals and visitors lament they have not visited a neighbouring island but would have visited North America and or Europe instead,” Jordan declared.

He observed that taxes feature highly in the proportionate cost of an airline ticket.

“Governments cannot guide the airline to success with the laments, petty quarreling and or bragging rights, while the airline is faced with its major financial challenges,” the Saint Lucian Economist noted.

“If you are looking for an innovative solution, I think it is time that the politicians allow the highly successful business gurus of the region manage LIAT to resolve the current demise which politicians will continue to face but don’t seem to have a clue as to how to resolve.  Over to you Chairman of LIAT, over to you Caribbean Development Bank and I hope this note enables the debate towards a solution for LIAT,” Jordan concluded.