LIAT Secures CDB Loan After Finances Take Hit From Hurricanes

ST JOHN’S, Antigua, Friday October 20, 2017 – Regional carrier LIAT is on course to get some relief from its shareholder governments after Hurricanes Irma and Maria left a deeper hole in its finances.

The Antigua-based airline is soon to receive a US$7 million loan secured by the governments of Barbados, Antigua and Barbuda and St Vincent and the Grenadines.

Chairman of LIAT’s shareholder governments, Dr Ralph Gonsalves told journalists at a news conference this week that LIAT had to cancel 408 flights  since it could not provide services to Dominica, St Martin, Tortola and Puerto Rico which were significantly affected by the Category 5 hurricanes last month.

“These markets account for 30 per cent of the total flights and 35 per cent of total revenue,” he said, adding that this translated into “revenue loss of EC$5 million (US$1.8 million).”

Gonsalves, who revealed that shareholders governments met last week, said they were told that the financial impact of weather systems this hurricane season would amount to EC$6.5 million (US$2.4 million) and market recovery would take as long as 12 months.

“Continuing, we will lose about US$780,000 on the St Martin route, about US$1.3 million on the Puerto Rico route, and about US$950,000 on other route with the depression of the market,” he said.

The Vincentian leader disclosed that LIAT was initially expected to make an EC$2.8 million (US$1 million) operating profit this year.

“But it is going to turn out that we are going to have a loss of about EC$35.6 million (US$13.2 million). That is what is forecast.”

As a result, a 15-year loan from the Caribbean Development Bank was secured.

Antigua and Barbuda will be responsible for US$2.4 million; Barbados, US$3.72 million; and St Vincent and the Grenadines, US$840,000.

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