Loveridge: Jamaica’s protectionism hurting Caribbean unity, tourism

PM Golding tilts the playing field against REDjet and Barbados

In the next 24 hours, some 6,000 people will read this article by Adrian Loveridge. We can only hope that Jamaica’s Prime Minister will be among them.

Has REDjet been treated fairly?

by Adrian Loveridge - small hotel owner

It’s a big question and without all the facts in hand it would be difficult to be totally objective.

However, if you ask the questions, is the concept of a low cost carrier desirable in the Caribbean and can it be made to work, then the answers have to be yes, and probably if they are allowed to operate in a truly commercial environment.

When you can book a week-long cruise that visits seven Caribbean islands with travel, accommodation and food all included for less than the cost of a return airline ticket to one of those territories, then something has to be fundamentally wrong.

LIAT now enjoys a virtual monopoly on certain routes out of Barbados, which includes Puerto Rico after the withdrawal of American Eagle.

According to their website, the cheapest return flights (a round trip of 1,140 miles) bookable in late June to San Juan is US$664.09, which includes a whopping US$176.09 in taxes and add-ons.

For exactly the same dates, return flights to New York with American Airlines cost US$615.50 (including US$177.50 in taxes) and US$664.80 (US$166.80 taxes) with JetBlue, a journey involving 4,182 miles or nearly four times farther both in miles and flying distance than Puerto Rico.

“If LIAT had competition on the San Juan route of course fares would be lower and that is why we need an airline like REDjet.”

REDjet has been criticised by some for having not having a viable business plan but does LIAT or the amalgamated Caribbean Airlines and Air Jamaica?

Without past massive taxpayer subsidies all three of these carriers would have perished by the wayside years ago and the much delayed partial assimilation of the ‘Lovebird’ by CAL has also been finally made possible only after the government of Jamaica wrote-off off huge debts.

And we have to remember that in its entire 42-year history, Air Jamaica recorded a profit in only one of them, 1986.

So when we talk about fairness, what do we really mean?

To the best of my knowledge the owners of REDJet have not asked any government for taxpayer bailouts, heavily subsidised fuel, preferential interest rates or any other major concessions. They just want to operate in a commercially level playing field where competition, supply and demand and all the other factors that in the ‘real world’ decide economic survival or failure.

The people of Jamaica now own a 16 percent stake of Caribbean Airlines and it has been designated that island’s national carrier to the world.

Clearly, Prime Minister Golding is keen to protect that interest and recently stated he was “not saying the REDjet application would not be approved, but it would have to be allowed with the CAL deal in mind”.

Perhaps he has every right to be so protective, but does it really foster better Caribbean unity or take us a step closer to marketing the region as one?

The writing is on the wall, the president of the Barbados Hotel and Tourism has already graphically warned that summer tourism business is down.

REDjet has clearly demonstrated that it can drive additional traffic to Guyana and there is no reason to believe it wouldn’t be the same for Trinidad and Kingston. This just may reduce the real risk of additional hotel closures and job losses this year.

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8 Comments

Filed under Aviation, Barbados, Barbados Tourism, Jamaica

8 responses to “Loveridge: Jamaica’s protectionism hurting Caribbean unity, tourism

  1. watcher

    One of things that is “fundamentaly wrong” is the much overvalued Barbados dollar which has lead to Barbaods being an overpriced tourist destination when compared to the markets it trys to compete in.

    With Red Jet, staycations will not even be competitive with vacations for Barbados residents travelling to other locations in the Caribbean.
    |

  2. What will they think of next

    Adrian, I was saying to myself the other day that I don’t see or hear Adrian.

    Welcome back man.

  3. yatinkiteasy

    When you can have a beautiful (fresh) fish dinner at Oistins for under $15 US, and chase it down with a cold Banks for $2.00, Barbados is not expensive. Eat and drink at several places on the West Coast and you will find everything overpriced. But the person staying at Sandy Lane and paying US$1000 and more per night does not care about paying $6 Us or more for a Banks at that hotel.
    The disparity in prices proves that it is not caused by an overvalued currency, but rather by providers charging as much as their market can bear.

  4. amusing

    “REDjet has clearly demonstrated that it can drive additional traffic to Guyana ..” and how is this statement substantiated ?
    Charity begins at home.. or as the clarion call of the inward thinkers goes ..” home drums beat first..” so where is the tangible support from our PM and government for Redjet ?

  5. Adrian Loveridge

    Amusing,

    ‘REDjet has reported that since its entry to the Barbados/Guyana route it has seen a 35 per cent increase in traffic’.

    And could reduced rate air freight also benefit Barbados?

  6. amusing

    Adrian… i read that as being Redjet has increased “its” traffic by 35% …however i stand corrected.

  7. Anomynuss

    http://www.trinidadexpress.com/news/REDjet_landing_rights__still_on_hold_-124928649.html
    Yesterday, Barbados Prime Minister Freundel Stuart told reporters in Basseterre that there was no real movement to report after high-level talks with his Caribbean Community (Caricom) counterparts in caucus on the contentious issue of regional air transportation.

    He reported that both Prime Minister Kamla Persad-Bissessar and Bruce Golding of Jamaica were maintaining their strong allegiance to Caribbean Airlines (CAL), in which their governments hold joint ownership.

    “I do not know we have made the kind of progress which I hoped for, and for the very simple reason that it is clear to me that the government of Trinidad and Tobago is committed to ensuring that its airline’s interest is not undermined,” said Stuart.

    He added: “The government of Jamaica which entered into an agreement with Trinidad and Tobago does not feel able to renege on any commitment it gave to the government of Trinidad and Tobago in respect of not undermining the integrity of the relationship between those two countries so far as regional transportation is concerned.”

    Well, I’m glad that is out in the open… yes, it’s true, Trinidad (and Jamaica, on instructions from Trinidad) are teefing from the treaty of Chaguaramas (which was signed in Trinidad, by the way) and all other regional agreements because they are protecting Caribbean Airlines.

    Now that Barbados PM Stuart has heard it directly from his HoG colleagues, perhaps he will have some tangible reason to react on behalf of Barbados – and perhaps he might be willing to draw his other Caribbean colleagues into some kind of opposite reaction to these two renegades.

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