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LETTER OF THE DAY - Flying against the jet stream

Published:Monday | February 15, 2010 | 12:00 AM


IN AN era of global airline deregulation, and the promotion of free-market economies, it's startling to see the Jamaican Government signing an official non-binding agreement that would preclude any qualified group of Jamaicans from starting and/or running an international flag carrier to serve overseas destinations. In its relentless pursuit to divest our national treasure - Air Jamaica - the Government has gone too far by accepting unnecessary restrictions that may potentially hurt the country's economy in the long run.

Any agreement that restricts competition is usually foolhardy, and can only be justified in the case where there are other overwhelming considerations. While most airline privatisation programmes will have limitations on what future carriers can do, there is typically a time limit to these restrictions to ensure that the acquiring entity has an opportunity to recoup their investments. In this situation, I see very little reason to accept this stipulation in any agreement, since the government will be assuming the majority of the debt burden of the legacy of Air Jamaica.

Jamaica has always been and will continue to be a welcoming destination for its visitors. This has been the same in the airline industry, where we have seen the introduction and rapid growth of various airlines serving the island. Today, we are now accustomed to the newbies, such as JetBlue Airways, Spirit Airlines, United Airlines and Virgin Atlantic. While these are established carriers in their own right, they are new to the Jamaican marketplace, yet they have been welcomed with open arms. Why is it then that we, as an independent sovereign country, would sign an agreement to prevent our people from establishing viable scheduled airline carriers to serve the local demand, and help promote the Jamaican brand worldwide?

Demand is there

It is evident from the number of scheduled and charter carriers serving the island and Caribbean region that there is ample demand to support multiple indigenous airlines on the island. As a country that relies heavily on tourism, it is essential that we have the ability to promote our brand - Jamaica - and provide the necessary service to support the Jamaican diaspora worldwide.

While I am sure the Government is eager to accomplish its goal of divesting Air Jamaica as soon as possible, it should not make unwise decisions that may come back to hurt us as a country and region in the future. One should not 'cut off your nose to spite your face'!

I am, etc.,

Michael Clarke

Airline consultant, Atlanta, GA