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Air Jamaica is NOT to blame (131 MILLION mountain of debt was not transferred to Caribbean Airlines

The Jamaican Government maintains a 16 per cent stake in the airline.


Jamaican Government's sale in 2010 rejected recent reports that the airline was an albatross around the neck of its Trinidadian rescuer.

CAL did not get any assets or liabilities of Air Jamaica when it started operating the national airline in May 2010, said the head of the divestment team, Dennis Lalor. Nor were Air Jamaica's operations merged with CAL's even when it began operating under the Caribbean Airline's brand a year later.

This contradicts news reports in regional media that said some of Air Jamaica's debt burden, put at US$1.5 billion ($131 billion) by former Finance Minister Audley Shaw in a statement to Parliament last year, was passed on to CAL when the airline was bought out.

"The Government of Jamaica assumed all liabilities of Air J, providing CAL a clean slate as it relates to Air J's operations," Lalor said, adding that this was done to ensure that CAL would have no disadvantages when it got the Air Jamaica brand.

"In addition, the Government of Jamaica provided CAL with cash of over US$17 million, which represented tickets prepaid for by customers not yet flown."

CAL took over Air Jamaica routes that it continued to operate under that brand and for which "CAL has the exclusive right to use in exchange for maintaining certain minimum service levels".

Jamaica's role was to make it easier for CAL to operate as its national airline by supporting a waiver that allowed Air J to continue flying to North American markets, Lalor said. These include routes to Fort Lauderdale, New York and Toronto.

The agreement between CAL and Air Jamaica, which left the Jamaican Government with a 16 per cent stake, was finalised a year ago.

The Government's involvement with Air Jamaica is limited to the appointment of one director, currently Lalor, who represents the country's minority share.

The divestment team believes that a regional airline can be viable, Lalor said, and hopes that CAL's reported losses will soon end.


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Comment by Military Diplomat on May 31, 2012 at 12:54pm

Exactly Vinny, we have to think that corruption is a factor as we are still bereft of the details of the deal.

Comment by Mervin E Yearwood on May 30, 2012 at 4:07pm

Wow this is something crazy not to account for the possible liability. I have used the original B.O.A.C./ B.W.I.A, AIR JAMICA which services was extra ordinary! Hope that it can regain the publics trust !

Comment by Vinny Pat on May 30, 2012 at 3:15pm

Disapointing, you would think the two countries can get it's act together.@ Military, probably don't have to guess that corruption is involved here.

Comment by Military Diplomat on May 30, 2012 at 12:32pm

So what really is the truth? I feel that the CAL people were ill-suited to take on AirJ in the first place, as they were struggling with BWee/CAL. the Bruce Golding Administration (Jamaica) and the Manning Administration (Trinidad) owe the truth to their people.. both countries have freedom of information laws, yet the details of this agreement are not public. I believe it will only be a matter of time before CAL drops the Air Jamaica brand.. they both cannot be carried by the TnT government, and it really is a shame, as Air J (and no bias) here, is a better brand, so was BWee over the CAL brand. I really don't believe in government as the regulator and as an operator in the aviation field, as there will be bias, and abuse (just check the REDJet imbroglio), I would've preferred for the Air J brand to have gone to either the pilot association, or even the Chines. Why you may ask? Well the Chinese are all about business.. and the abuse by public officials who want to travel free and occupy seats which could've been sold would definitely not be supported by the Chinese, this kind of ethic would see improved business performance by the airline.. course this is all hypothetical now, but think about it people.. in the meantime, we are held ransom to the high airfares and our travel/ tourism industry dies.

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