AIR JAMAICA Chairman Gordon 'Butch' Stewart says he has lost his US$25 million investment in the heavily indebted national carrier.
The Air Jamaica Acquisition Group, in which Mr. Stewart was the lead shareholder, acquired 70 per cent of the airline in 1994. The AJAG group was to have paid US$26.3 for its holding, leaving the government with 25 per cent of the shares, and the staff with five per cent.
"I have lost my investment already," Mr. Stewart said. "I have lost US$25 million."
He was speaking on the 'Perkins Online' radio programme with host Wilmot Perkins on Power 106 FM yesterday.
The Public Accounts Committee revealed on November 2 that Air Jamaica owed $14 billion in taxes, including $1.9 billion to the Airport Authority which operates the Norman Manley International Airport. Information Minister Burchell Whiteman has since disclosed that the airline lost more than $34 billion since it was privatised.
"None of us goes into business to lose money," Mr. Stewart said. "I am there doing the national service."
CRITICAL ROLE
The role that Air Jamaica plays is critical, because without it, "you would have literally a bankrupt tourism industry," he said. This is because the airline develops markets and spurs other airlines to develop new routes to the island.
"Who would believe you would have daily flights from Jamaica to London?" he said. "It is Air Jamaica that is up there making it work."
The airline may lose money, but it underpins much of the country's tourism prospects, he said, adding that efforts are being made to bring the financial problems under control.
The airline's Chief Executive Officer,
Chris Zacca, said in October that US$50
million of its annual costs would be cut to make the airline viable. This process would include reductions in staffing and in overseas advertising.
The airline requires close to US$120 million over the next five years to keep it flying, Mr. Zacca told Mr. Perkins. This, he said, "will be met by a combination of debt which will be held constant at the end of this year through five years and some injection of equity to the tune of about half of that."
His goal is to serve the national interest, Mr. Stewart said. "We have to work in this difficult period to reduce losses and hopefully get into the black (make a profit)."
"My stewardship is simple," the chairman said. "My big picture is Jamaica."
