The announcement that the Qatar Civil Aviation Authority has signed an agreement with the Government of Guyana which will permit award winning Qatar Airways to operate any number of passenger and cargo flights between the two countries, is significant more than it first appears.
It will also allow the airline to open an operation base in Guyana and fly to any other country in the region and other regions as well. Clearly this ground breaking decision is driven by Guyana’s increasingly important position being poised to become a major player in the gas and oil industry.
The implications for the Caribbean go far beyond direct flights from the Middle East, giving the opportunity of opening up further investment possibilities by making access infinitely more feasible.
Currently the Sovereign Wealth Fund administered by the Qatar Investment Authority is the 10th largest in the world with a quoted total asset value of US$328 billion. Among its many substantial shareholding ownerships are Barclays Bank (12.7%), Volkswagen Group (17%), Harrods (100%) and is the single largest shareholding in British supermarket chain Sainsbury’s, with 21.99% of its voting shares.
According to Forbes, Qatar is officially the richest country in the world, not bad for a nation with an estimated population of fewer than 2 million, perhaps, reinforcing the concept that, size really doesn’t matter.
In 2013, Qatar boasted the world’s highest GDP (Gross Domestic Product) per capita of US$105,000, twice that of the United Kingdom and United States, while their economy grew by 19%, the fastest rate in the world at that time.
The website, 2ndpassports.com, explains that a typical Quatari business person will log thousands of hours and millions of miles in air travel throughout their career and that a staggering 15 per cent of Qatar citizens are millionaires.
From a tourism perspective, Qatar owns or controls an enviable number of luxury hotels globally, including the Peninsula, Hotel Louvre, Concorde Lafayette and Le Grand in Paris, Hotel Martinez in Cannes, Palais de la Mediterranee in Nice, Four Seasons in Florence, Claridge’s, The Berkeley, Connaught, Savoy and Intercontinental Park Lane in London and New York’s Plaza Hotel.
Various Caribbean nations have made overtures to Qatar and other gulf states, sometimes linked with citizenship-by-investment schemes, to help drive upmarket hospitality projects.
Qatar Airlines operates a hub and spoke network linking over 172 international destinations with a fleet of more than 250 aircraft, making it one of the largest passenger operators, while the cargo arm of the airline is the world’s third largest freight carrier.
A direct flight from Doha to Georgetown is 7,235 miles or 11,643 kilometers (great circle), so with existing aircraft, a journey time of at least 15 hours. Could seamless links into these flights provide exciting further potential for our tourism industry, both in terms of increased investment and new markets for arrivals?
And just maybe, with a dramatically revised and viable business plan it could just provide LIAT with a lifeline and some hope.
I am sure our policymakers and planners are already looking into the possibilities.
Adrian is getting out of his area of expertise with this article. Trying to imply that Qatar is getting setup for tourist passenger operations to and from Guyana, which is so far from the truth to be laughable. He needs to dig a little deeper to discover the real reason why Qatar has initiated this agreement. Do some indepth research along the lines of Qatar investment and drvelopment of the newly discovered oil/gas field discoveries that Guyana may ultimately have jurisdition over, also check if Qatar has similar agreements with other countrues boardering these same oil/gas fields. Qatar is a big business country, like Adrian pointed out, controls various lucrative adventures around the globe and these new agreements are just one of many potential new business opportunities which Qatar is putting the ground work in place early to ensure the countries continued successful businesses.
IT’S called foresight and future planning which is not in the BAJAN political vocabulary.
please do us all a great big favour and READ the column before commenting – ‘Clearly this ground breaking decision is driven by Guyana’s increasingly important position being poised to become a major player in the gas and oil industry’.
“I am sure our policymakers and planners are already looking into the possibilities”
Do not hold out much hope.
Adrian: With the record of Qatar Airlines, subsidizing airlines with government funds with the purpose of establishing market share, I would be very careful in thinking this may be positive for LIAT.
my thoughts were that IF Qatar operate a service to Guyana, it will have to be a A350, A330 or B777ER or another long haul aircraft and they will need to fill seats. Smart partnerships with existing airlines will be essential. With a hugely revised LIAT business plan they may be tempted to take a percentage shareholding and offer low cost finance to reduce existing loans/lease payments.
Adrian: Competition is what leads to lower fares. Considering the fact that Qatar is subsidized and would subsidize any airline it was invested in, it would make competition rather difficult for a non subsidized airline. How often would service be to Guyana to fill an aircraft of the size you are suggesting?
Putting things in perspective.
” Aug 13, 2019 – Exxon expects the first Stabroek oil to flow to the Liza Destiny, a storage and offloading vessel, in early 2020,
with production quickly ramping up to 120,000 barrels a day and rising by 2025 to 750,000 a day (roughly on a par with last year’s
daily output in Indonesia, which has a population of 264 million).”
Adrian, Qatar are not interested in TOURIST TRAFFIC to/from Guyana, thier only interedted in supporting and investing in the petroleum potential, cargo yes, workers yes, tourists NO. You forget Qatar has more sand and beaches, first class hotels and all the TOURIST amenities, their not interested in promoting Guyana or the adjacent areas for tourism.
Qatar has an enormous sovereign fund like you stated, this was not amassed by making assinine wishful decisions like those of BARBADIAN POLITICIANS, business first.
Antigua PM has communicated that he is no longer interested in buying Barbados shares in LIAT. Instead he will borrow 40 million from ALBA to inject in the LIAT operations to rationalize etc. What is the role of the Board of LIAT?
Where can I read this information?
It was on the 7:30am voice of Barbados news bulletin this morning. Browne disclosed it on his radio show.
It seems as though Gaston Browne has elevated himself as Chairman of the LIAT Shareholders Government Group of Countries.
Recall in sometime in May 2019, he went “behind the backs” of the other shareholder islands’ PMs and negotiated a deal with Virgin Atlantic’s Sir Richard Branston and developed a plan to restructure LIAT, after which he said he would present the details by the end of May.
Where is the “real chairman,” Ralph Gonsalves? Recently, he has been quiet on these issues.
I believe if the Barbados government is serious about divesting its shares in LIAT, it should view this development as an opportunity to look at offering those shares to international bidders.
The following link provides a bit more information on the LIAT issue.
Gaston Browne seems to have come up with a smart way – he thinks – of securing majority shareholding by reCAPing LIAT.
Tourism executives Petra Roach and Marsha Alleyne have been appointed to new roles at the Barbados Tourism Marketing Inc. (BTMI).
Roach is the new Head, Global Markets and Alleyne is now Chief Product Development Officer.
“Gaston Browne seems to have come up with a smart way – he thinks – of securing majority shareholding by reCAPing LIAT.”
I came to a similar conclusion after I read an article in today’s “Caribbean News Service,” which reported Browne as having said “I have indicated to [Mottley] that the Antigua and Barbuda government has $40M that could be made available to capitalize LIAT and that there should be a fresh capital call in which we will have the existing shareholders and possibly new shareholders recapitalize LIAT.”
Browne also said: “If LIAT were to fail, the economic consequences for Antigua and Barbuda would be significant and we have to go the extra mile to ensure that LIAT survives.”
Browne promised Antiguans he would build a UWI in Antigua and take over LIAT……. all that’s left for him to do is get the US Embassy moved from Barbados to Antigua.
It was also reported that the reason for the high regional airfare is linked to the cost associated with maintaining the airports in the region.
It seems we have a problem. It seems Antigua will have a problem if it follows through.
The proposed Antigua & Barbuda investment is actually EC$40M or US$14.8M
After reading the below article, I’m wondering what is Ronald Toppin’s position on LIAT now he is a government minister?
Wed, 11/23/2016 – 12:00am
LIAT A FINANCIAL BURDEN
AN Opposition Member of Parliament is arguing that regional airline LIAT is sucking Barbados dry and is adamant that serious decisions need to be made in relation to its future.
Member of Parliament for St. Michael North, Ronald Toppin, a former Government minister who held responsibility for tourism and international transport, is suggesting that the airline is nothing more than a bottomless pit when it comes to the injection of money. His comments came as he made his contribution to the debate in the House of Assembly yesterday on the Supplementary Estimates No. 1 2016-2017 in the amount of $33 111 620, which is required to bring to book equity contributions made by the Government of Barbados to LIAT (1974) between 2012-2013 and 2015-2016.
“Today we have the Minister bringing a resolution without at the same time bringing any financials in relation to LIAT that we could have the benefit Sir of examining… LIAT has never been a viable entity. As far as I am aware, it has never made a profit in any year. It has never been able to stand on its two feet,” he noted.
He made the point as he maintained that in spite of the US$65 million loan that LIAT obtained to change its fleet and declining oil prices, which should have lowered the company’s operating costs, it remains unviable. With that in mind, he further argued that LIAT has “grossly underperformed” as a regional carrier, and lamented that the burden and inefficiencies of the airline have fallen disproportionately on the shoulders of a few governments, especially Barbados.
To that end, he said that the constant injection of money into the company, which has been subsidised for over 40 years, cannot continue. Instead, he said what is needed, is for the airline to truly become an efficient and low-cost carrier.
“It is really high time, Mr. Chairman, that serious decisions are taken in relation to LIAT. The time has come where we cannot any longer shelf the need to take some very serious decisions in relation to LIAT,” he said.
Toppin’s comments came as he argued that Barbados, the largest shareholder, was not getting the maximum financial returns on the money that successive governments across the political divide have provided to the airline. He is therefore adamant that this also needs to be addressed.
We should be use to the mouthings of Opposition talking heads not aligning with when they attain government by now.