BASSETERRE, St. Kitts - WITH cash-strapped regional airline LIAT eyeing a return to the skies as early as next month, the Administrator, Cleveland Seaforth, is now moving to terminate all existing staff contracts with a view to rehire on a smaller scale, as regional governments agree to write-off the debts.
The airline is currently being managed by the Administrator, who was tasked with reviving operations on a smaller scale including working with creditors on debts write-offs, among other initiatives.
As part of restructuring the airline's significant debt, the Administrator engaged regional governments to write-off monies owed for landing fees and other taxes.
Those engagements, according to Antigua and Barbuda’s Prime Minister Gaston Browne, have borne fruits as all regional leaders have agreed to the write-off.
“I’m told that nearly all of the countries within the region that they are cooperating. I know that Barbados would have written to the administrator agreeing to write off the amounts owed to the Barbadian Government. Similarly, Dominica, St. Vincent and the Grenadines, and Antigua and Barbuda,” Browne disclosed on Pointe FM
With the agreement now coming into place, Prime Minister Browne on Saturday (Oct. 9) said that the total sum would be close to $70M that would be cleared from the balance sheet of the fledgling airline.
With that being said, Browne disclosed that the Administrator is still working with other creditors to find a common ground on the way forward for the debt owed by the company.
However, the Antigua and Barbuda Cabinet has decided to continue providing financial assistance to the Administrator for plans to save the airline from liquidation.
“As soon as we get that plan from the Administrator, the Government of Antigua and Barbuda has committed to providing the funding. In fact, the funding that we are providing will be done as a preferred creditor."
The Prime Minister went on to say that it would be a “downsized LIAT” with four planes, not a large fleet of 10 that was operational since there is no market demand for that many planes.
“It means too that the amount of people working for LIAT going forward will be significantly reduced. And my understanding is that the Administrator will be terminating all existing contracts, and the existing individuals will be placed on new contracts in order to operate the new airline going forward.”
Against that backdrop, he emphasized: “…it will be a very lean and efficient entity and there is no way that we will waste taxpayers money to fund a bloated institution.”
The airline is over $100M in debt, and the former shareholders were pushing for it to be liquidated. However, Antigua and Barbuda has been pushing for a lean operation to save the regional carrier.