ST GEORGE’S, Grenada, Friday June 15, 2018 – Antigua and Barbuda’s Prime Minister Gaston Browne has called on regional governments to embrace the reforms that are needed to create a sustainable air transport sector in the Caribbean.
Speaking at a seminar on Air Transport Connectivity and Competitiveness hosted by the Caribbean Development Bank (CDB), he said reliable connectivity of air transport in the region is quintessential to the movement of people and goods.
“So it is evident that reliable air transport is important to the integration movement. It is also fundamental to the overall economic growth and resilience, especially in the tourism sector, [of] those countries that are heavily dependent on tourism,” Browne said.
He noted that one of the most critical areas for reform involves the reduction of regional airport taxes and service charges, saying that this would stimulate additional travel within the region, as well as increases in tourism.
However, the Prime Minister added that any solutions to the challenges faced in the air transport industry would need to have buy-in from all countries in the region.
“One of the solutions that I am proposing is a subvention by all countries within the region, certainly within the OECS [Organization of Eastern Caribbean States] and Barbados…We have to see the subsidy as an investment in our tourism product, an investment in the integration of our people, to move goods, to move people and to ensure that the integration process works,” he said.
During the seminar, CDB also presented a working paper on Aviation Competitiveness and Connectivity. Dr Justin Ram, Director of Economics at CDB, said the research seeks to provide an evidence-based approach to examining the importance of air transport connectivity to the region.
“In the Caribbean, because of where we are, we need to travel quite a lot. Looking at the current state of aviation, we have seen that extra-regional travel has increased over the period 2007 to 2016. However, intra-regional travel has declined. There are a number of reasons for that, including high costs, high taxes, fees and charges, inefficient use of assets such as airports and aircrafts and an inadequate regulatory environment ,” the CDB official said.
The working paper suggests that a number of policy remedies could be implemented to enhance air connectivity, including a reduction in aviation taxes; reduction in airport charges; bilateral service agreements and improvements in infrastructure. If these policies are taken on board, in one scenario it is estimated that an additional 288,000 jobs would be added across the region, along with US$4.4 billion in GDP.