Freeing up skies will destroy small airlines - aviation expert
Published:Monday | August 9, 2010 | 12:00 AM
Janet Silvera, Senior Gleaner Writer
WESTERN BUREAU:
THE ONLY Jamaican-owned airline left in the regional market, Airways International, says "overnight, full-freedom, open-skies" agreements will cripple the local aviation business.
Describing the era when Air Jamaica, the now-divested national carrier, ruled supreme as a period marked by protectionism and suppression of small airlines, Airways International Chairman Christopher Read feels this is not the time to accommodate more undefined open-sky accords.
However, this is the posture that has been taken by the country's transport and works minister, Mike Henry.
In recent weeks, Henry has been aggressively touting open-sky agreements with many states, including India and Singapore, as well as Africa, in a bid the ministry views as crucial to increasing air commerce to the island.
But Read disagrees.
"There are caveats to open skies and different levels within established routes."
Overkill
While conceding that the opening up of highly developed, heavily trafficked routes would benefit passengers, Read argues that similar access privileges to less developed, or 'immature', routes could destroy small airlines.
"In the case of an immature market, as is the case with CARICOM, what open skies can do is create an oversupply that a small Jamaican company could not compete successfully in," he explained.
Read recently announced that his Jamaica Air Shuttle, which currently flies between Montego Bay and Kingston, will expand service to Haiti and Cayman Brac, the Cayman Islands.
Bleak future
But the aviation expert sees his business folding under competition from larger airlines that could afford to subsidise routes for up to three years before making a profit.
He said with the 'Fifth Freedom of the Air', a convention of open-sky agreements, that is being touted, "A large carrier could come in here, subsidise any route that it chooses and effectively block a Jamaican operator from competing on the route."
The Fifth Freedom of the Air allows the right or privilege, in respect of scheduled international services, granted by one state to another, to put down and take on, in the territory of the first state, traffic coming from or destined to a third state (also known as Fifth Freedom Right).
Read favours the Third and Fourth Freedom of the Air, which currently allow Jamaicans to fly to, drop off and pick up passengers from another sovereign country.
He is convinced that Jamaica is ideally located to become the western hub for inter-island connectivity, but at this time local carriers should be allowed to step up to the plate.
In response to the concerns, Henry said all avenues of business develop from competition, and every country that has utilised open skies, mainly the United States and Canada with which Jamaica already has such deals, have seen it grown exponentially.
He said his intention is to enhance regional carriers, and he urged local companies like Airways International to enter into code-sharing, an arrangement in which airlines sell tickets for each other.
"We cannot continue to think in the vortex of decline, because what we are doing is expanding the horizons and the opportunities," the transport and works minister remarked.
Though saying his office was open to hear the concerns of small operators, Henry noted that Jamaica must become an important global hub.
"We cannot continue to think in a closed market of protection," he said.