Janet Silvera, Senior Tourism Writer

Former Federal Reserve Chairman Alan Greenspan. - File

Washington, DC

Caribbean leaders are no closer to finding a long-term solution to the debilitating aviation crisis that has beset the region's tourism industry, even after guaranteeing revenue to a number of legacy carriers.

Addressing prime ministers, tourism ministers, commissioners and general delegates at the first Annual Caribbean Tourism Summit (ACTS) in Washington, DC, yesterday, Dr Alan Greenspan, former chairman of the United States Federal Reserve, said it was clear that, if there was no reduction per mile to the cost of jet fuel, there would be immense impact on the region's tourism industry.

Fuel-inefficient AIRcraft

"The old aircraft that are being operated are highly fuel inefficient and only when you improve technology in them will there be a change," he told the gathering.

Greenspan's assessment comes at a time when experts have predicted that the issues faced today probably represent the single-largest economic, social and political threat that the region has seen for many years.

The shock waves that the industry is experiencing are even greater than 9/11, the experts have noted.

With oil moving from US$20 per barrel five years ago to US$135 up to yesterday, forecasters estimate that all major legacy carriers will be in default on various debt covenants by the end of 2008 or early 2009.

The dim report, which was published by Business Travel Coalition and AirlineForecasters, implies that several large and small airlines will ultimately end up in bankruptcy and, of those, some will be forced to liquidate.

Conference

However, the region has no plans to sit on its laurels and watch its demise. Admitting the aviation crisis was deeply affecting the Caribbean, newly elected president of the Caribbean Hotel Association, Enrique deMarchena, said come July 2, there would be a full day dedicated to the issue at the CARICOM Heads of Government conference in Antigua.

"Decisions must be taken in order to preserve the business here," he stated, suggesting the time was ripe for the region to work on integration and consolidation.

The new actors in the market, Brazil and Dubai, have money, he said, adding that, with stiff competition from both countries, one rich in oil, this should serve as the signal that it's now or never for the 'One Caribbean' marketing campaign to take precedence.

"Large countries such as Jamaica and the Dominican Republic must lead the charge," he urged.

janet.silvera@gleanerjm.com