- NORMAN GRINDLEY/Staff Photographer
Leonard Green (left), Rotary Club of Kingston president, greets chairman of Air Jamaica, Gordon 'Butch' Stewart, before the start of the Rotary Club luncheon at Hilton Kingston Hotel yesterday. Mr. Stewart was guest speaker at the function.
Al Edwards, Financial Editor
CHAIRMAN OF Air Jamaica, Gordon 'Butch' Stewart, said yesterday that despite the national carrier's financial woes, it cannot be allowed to go under, stressing that it would need additional funding over the next two years.
Speaking at the downtown Kingston Rotary luncheon held at the Hilton Kingston Hotel, Mr. Stewart said: "If Air Jamaica fails at this time it would be a catastrophe of the proportions that would make FINSAC look like petty cash. The bigger picture is that the losses of Air Jamaica is small change in comparison to what it contributes to the Jamaican economy." FINSAC's debt, according to government figures, stood at J$140 billion.
J$14 BILLION OWED
Last month it was revealed that Air Jamaica owes the Govern-ment J$14 billion in unpaid taxes and fees, and that the national carrier had lost more than J$34 billion since its privatisation in 1994. It is also said that the airline is carrying a debt burden of almost J$42 billion of which J$8.5 billion is owed to Government.
Mr. Stewart reiterated the point he made two weeks ago that Air Jamaica has always been transparent and has no intention of neglecting its tax obligations. He pointed to the fact that there was a number of US carriers that had declared bankruptcy or had to turn to their government for a bailout, adding that Air Jamaica had avoided going that route.
He also pointed to a Lou Dobbs report on CNN earlier this week which disclosed that the airline industry had lost more than US$30 billion since 2000 and is now expected to lose a further US$5 billion more this year.
CALAMITOUS EFFECTS
"In 2001, the year of the September 11 terrorist attacks, we had cash flow and were poised to do well. The Government said it would help us in the aftermath of the attacks and its calamitous effects on the industry, but I thought we could get by ... and if we were really up against it ... then we would call on the Government. Maybe that was a mistake because when we were ready to turn to the Government the economy was in a tailspin."
Mr. Stewart said that Air Jamaica was responsible for 50 per cent of the airlift to Jamaica and played a pivotal support role to the country's tourism industry. The airline, he added, had helped to turn the Jamaican economy from negative to positive.
"The reason why there is an upsurge in the number of hotels being built in Jamaica is that hoteliers are confident that Air Jamaica will supply the required airlift. Our gateway costs are up to US$150 million and Air Jamaica will continue to develop gateways as we continue to stimulate the market and increase our market share. We cannot allow other carriers to replace Air Jamaica and service the country's number one industry."
