Minister of Finance and the Public Service, Hon. Audley Shaw, says that the Government is satisfied that merging the national airline, Air Jamaica, with regional counterpart, Caribbean Airlines, was a correct and timely move.
Speaking at Mayberry Investments Limited’s monthly Investors Forum, at the Knutsford Court Hotel, New Kingston, on Wednesday (January 19), Mr. Shaw said that in light of losses incurred by Air Jamaica prior to divestment, the decision to sell it, and other loss making entities, such as the sugar factories, was "courageous".
"We were subsidizing Air Jamaica to the tune of, at least, $10 billion per year. As it has now turned out, having negotiated a deal, where we maintain 16.5 per cent ownership in the new larger Caribbean Airlines, with an equity base of US$500 million for that airline, we automatically have an equity stake of US$80 million," he said.
More importantly, Mr. Shaw added, was the "larger stake" which, consequent on due diligence conducted by Caribbean Airlines and consideration given to the feasibility of the merger in the long term, the entity has made a "strategic decision" to maintain two brands, Air Jamaica and Caribbean Airlines.
"They have made that strategic decision to keep Air Jamaica, because of the strength of the brand image that Air Jamaica has, especially in the Diaspora. So what it means is that, our beloved airline continues as Air Jamaica," he noted.
He also acknowledged that new aircraft are being acquired, and they have transferred to the 737 series and are returning to London’s Heathrow Airport as of July. They are also putting in place two 787 dream-liners, larger aircraft that can take over 300 passengers, starting with the London route this year.
"So Air Jamaica is soaring to new heights, and we believe we made the right decision at the right time,' Mr. Shaw assured.
CONTACT: DOUGLAS McINTOSH