The Adrian Loveridge Column – Tourism is OUR Business

If I needed to be reminded for a single second that our policymakers, planners, politicians and private sector partners need to work closer together across the Caribbean, then it was at the recently concluded 4th annual Caribavia Aviation Meetup held in Saint Maarten.

I doubt a solitary speaker or attendee at that conference returned home with anything other than the same conclusion. Among the topics extensively discussed was the excessive taxation by Government’s, which were proving to be one of the single largest deterrents to growing tourism.

While the overwhelming positives outweighed the negatives, many of us were left with the disappointment that more of the key decision makers across the region did not make the effort to attend as they could well have hugely enhanced their knowledge and ability to increase their own individual destination numbers.

For Barbados, we have in the past been able to boast that the Caribbean was our third largest source market, but unless the subject of airlift is addressed quickly and effectively, it is almost impossible to imagine that this will continue.

As the widely recognized doyen of tourism, Vincent Vanderpool-Wallace CBE., graphically pointed out at the event – as he has on many previous occasions – proximity and connectivity are two of the most critical factors in air transport.

Simply put, that potential visitors on your doorstep can provide some of the greatest arrival opportunities, providing they can reach the destination with more affordable ticket prices. None of this of course, is a revelation or ground-breaking news, as it’s widely accepted as a fact of life in all other source markets.

When lower airfares are made available from the United States, Canada, United Kingdom and Europe, then increased numbers will travel to the Caribbean, yet many in critical decision making positions, do not seem to fully understand or embrace this within our region.

Few can seriously dispute the fact that low cost carriers have dramatically grown airlift into the Caribbean and you only have to cite jetBlue as a classic example. Our United States visitor arrival numbers stagnated for almost a decade until replacement key marketing personnel were brought into place and negotiated new or existing routes with various airlines. Westjet out of Canada is another case in point. And to a lesser extent Thomas Cook Airlines, with their seasonal services, from Manchester and Gatwick, which provides a less expensive flight option to many of our second home owners and shared accommodation offerings.

Ultimately, our politicians and policymakers will have to carefully weigh the overall tax collection benefits earned from visitors who are deterred by high airfares. Conversely, those who are tempted to our shores and pay VAT, room levies, DTS (direct tourism services) levies, shared accommodation levies and all the various additional taxes collected as a direct result of increased employment it creates.

Returning to the subject of working together, I believe there is also vast untapped potential if we partner with some of our neighbours. Enticing new carriers with triangle airline routes offers a low and shared risk possibility, especially with long haul carriers. If we are ever going to persuade Scandinavian airlines back to Barbados, it may be the only feasible way to attract their high cost-of-living population and where comparative on-island prices are not so inhibitive as many other markets.

10 thoughts on “The Adrian Loveridge Column – Tourism is OUR Business

  1. The team from Antigua is in Barbados to discuss buying a significant number of shares that will see them majority shareholder.

  2. Hip, Hip, Hooray!!!!

    I’m hoping the Mottley administration decides to offer the Antiguans Barbados’ ENTIRE shareholdings…..thereby eliminating the need for Barbadian tax-payers to “pump” millions of dollars into the airline annually….… while transferring that burden to Antiguan tax-payers in the process.

    Then, I’m also hoping the Barbados government adopts an attitude similar to that of the governments of St. Lucia and St. Kitts……… and not financially investing in LIAT, unless there’s a fundamental change to its operating structure.

    Remember LIAT’s minimal revenue guarantee (MRG) proposals, where Barbados, which had the 116 weekly departures, the highest by LIAT, was being asked to contribute US$1.614 million?

    It is interesting to note that Gaston said Sir Richard Branson is “coming on board” to invest in LIAT. However, chairman of the share-holder governments, SVG’s PM Gonsalves said he read the media report about Sir Richard alleged interest in investing in LIAT, but so far, he has not received any formal indication from Sir Richard.

    Gonsalves said: “As chairman of the shareholders, I have not been aware of that. Nobody has contacted me about that. I have seen the reports that Max Fernandez, one of the ministers in Antigua said so.”

    I see some very interesting times ahead for LIAT.

  3. David BU

    Yes….. and both the Antigua & Barbuda Labour Party and United Progressive Party seem to believe the islands and populace belong to them to do as they please.

  4. “Teams from both countries met today at the Hilton Hotel to begin talks, a week after Barbados’ lead negotiator, Attorney General Dale Marshall, revealed he had tried unsuccessfully to arrange a previous meeting with LIAT officials to discuss the details surrounding selling its 49.4 per cent stake to the Gaston Browne administration.”

    An interesting development.

    Is this an “unofficial” protest by LIAT officials against the sale?

  5. Still chasing LIAT about the double rate (US$70) of what they describe as BGI Passenger Service Charge on my BGI/SXM/BGI ticket and surprised to see that Mark Maloney is listed as a DIRECTOR on their board.

    • @Adrian

      Why are you surprised? Maloney has continued his excellent relationship with this government. Think ROSS!

  6. Caribbean economist urges governments to reduce air fares
    July 8, 2019 News784 Caribbean 0×381.jpg

    Director of Economics at the Caribbean Development Bank (CDB), Justin Ram has slammed regional governments for the high cost of air travel and he has called on them to slash the taxes and rake in more value-added and income taxes.

    “What I’m saying to governments—and I go all over the Caribbean—I say to governments: ‘stop being so myopic, reduce taxes on travel and aviation and let’s get more regional travel. You will recoup the revenues because when those people come into your country they will be buying more stuff and they will be paying more VAT (value-added tax),’” he told a Georgetown Chamber of Commerce and Industry (GCCI) dinner held on Friday.
    Ram, who was the featured speaker at the launch of the 10th edition of Business Guyana titled ‘Guyana: Potential Unleashed’, said the Caribbean faced a “real issue” when it comes to regional air travel.

    Noting that over the last 10 years, most Caribbean people were travelling extra-regionally while intra-regional travel declined because of the high taxes and fees, he highlighted that 60 percent of the airfare for Barbados to St Lucia are made up of taxes.

    Ram reasoned that if the taxes and fees on airfares are reduced, Caribbean governments would earn more from VAT and income taxes because Caribbean people will travel to other countries and spend more on goods and services, and more persons would be employed resulting in more income tax revenue.

    The CDB official was also concerned about the many security checks that travellers have to undergo while transiting airports, and he called on Caribbean governments to reintroduce the Cricket World Cup 2007 security system that had provided for persons to be checked once.

    “This is ridiculous and we really have to ask our policymakers to reform this,” he said. – Demerara Waves Online

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