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IATA official advises Caribbean Governments to create right business environment to improve aviation industry in the region

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by Eulana Weekes

St. Kitts and Nevis (WINN): The International Air Transport Association (IATA) Regional Vice President of the Americas Mr. Peter Cerda says Caribbean Governments and aviation industry stakeholders need to work in unison to rebuild aviation and tourism in the region.

Speaking to delegates and media personnel at the IATA 4th Caribbean Aviation Day forum in the Cayman Islands, Cerda shared a forecast by the World Travel and Tourism Council. The forecast suggests that the Caribbean region has the potential to achieve a 6.7 percent travel and tourism Gross Domestic Product (GDP) increase per annum between 2022 and 2023.

However, Cerda explained that the Caribbean must create appropriate business conditions, such as increase airlines connectivity, promote the Caribbean as a multi-destination market, improve travel experience for airlines and passengers and create a competitive cost environment. 

“The good news is that people want to travel, need to travel and are travelling. This has been made very clear with the ongoing recovery. Global traffic numbers have reached 74.6 percent of pre prices levels. In fact in the Caribbean, the recovery is even better at 81 percent. We even have markets like the Dominican Republic that have exceeded its 2019 numbers already [and] is one of the leading countries in the world. While international connectivity between the Caribbean, the Americas and Europe  has largely been restored, travelling within the region remains a challenge. We have only reached 60 percent of intra-Caribbean passenger levels compared to 2019 and in many cases the only way to reach other islands in the Caribbean is via Miami or Panama City; that’s concerning,” Cerda stated.

Though not the size of other regional markets around the world, Cerda said the intra- Caribbean market is one that must be served, not only for the good of the Caribbean people and business but also to facilitate multi- destination Tourism. He said selling and marketing the Caribbean as a multi-destination is becoming extremely important, considering inflation pressures and increased travel options across the globe.

IATA’s Vice President for the Americas advised that Caribbean Governments work together to modernize their travel policies, which will be more favourable to airlines and could also create a better travel experience to passengers. 

“When holiday makers are deciding where to spend their valuable vacation days in their budgets, being able to offer a variety of experiences will be key to success and when we fly, today’s travelers are also going to be looking for a seamless, simplified experience. While physical infrastructure is not a problem in this part of the world in terms of connectivity, creating the right conditions to generate the demand for a sustainable increase to air connectivity in the region is still a significant challenge. Outdated, redundant paper based administrative and regulatory processes continue to negatively impact airline operations. Together with those incharge at the Government level, we urgently need to move into the digital age; to provide better customer service, a better experience and more efficient and secure airline operations.”

Cerda commended the Caribbean Governments who during the Pandemic made available digital options for entry into their respective countries and urged them to build upon their experiences going forward, rather than reverting to outdated, inefficient options. He urged Governments and industry stakeholders to lessen the chatter and go forward in revolutionising the travel industry.

“Over the years with many of our Government colleagues and industry stakeholders, we’ve talked about the opportunity of doing it. There’s been a lot of chatter over the years and what I encourage my Government partners in the industry [to do is] “let’s follow the NIKE slogan, “Just do it.” It’s good business for Governments. It’s good for the aviation industry and Tourism and it’s going to be good for the travelling public, regardless if you live in the Caribbean or if you’re visiting the Caribbean,” Cerda expressed.

In the global aviation industry, the Caribbean has some of the highest taxes and fees on airline operation and passenger tickets. The air transport official confirmed that global taxes and charges make up 15 percent of ticket price, whilst in the Caribbean taxes and charges make up about 30 percent of ticket price.

He added, “Even more, in some markets taxes and fees charges can make up over half the ticket price and on a flight from Barbados to Barbuda, taxes and fees represent 56 percent of the ticket. Bahamas to Jamaica is 42 percent and St.Lucia to Trinidad and Tobago 42 percent; but when we look at a trip from Lima Peru to Cancun Mexico, another beach destination and a head to head competitor of Euros, the taxes and fees represent only 23 percent.”

Cerda said airlines are charged significant overtime fees for passengers arriving outside normal 9 to 5 business hours, deeming it an extra penalty. He added that aviation depends on global connectivity around the clock. Cerda also purported that Caribbean Governments be prudent by adjusting their taxes and fees and ensure that they do not price their countries out of the market. He explained that increasing taxes and fees can be detrimental to Caribbean aviation markets as well as their economies.

Cerda said there is potential for the aviation industry in the Caribbean to “Recover, Reconnect and Revive” assuring that the International Air Transport Association stands ready to lend its support.

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