Trinidad's government has retaken control of struggling airline BWIA, but the country's trade minister on Wednesday said the arrangement was only temporary.
BWIA was government-owned before being privatized in 1995. The government continued to own a 33.5 percent stake in BWIA until two weeks ago, when it increased its share to more than 75 percent, Trade Minister Ken Valley said."Quite frankly, I think it's lack of proper oversight," he said.
It took control by underwriting a Trinidadian $180 million (US$30 million) debt-for-equity swap. Private shareholders were asked to participate in exchanging debt for shares, but not enough did, allowing the government to substantially increase its stake.
Trinidad's government has bailed out BWIA repeatedly since the drop in travelers that followed the Sept. 11 attacks in the United States.
The company laid off a quarter of its 2,400 workers in early 2003 in an attempt to recover, but it has continued to struggle, recording TT$138 million (US$23 million) in losses last year.
Also last year, the government stepped in to assist when a leasing company seized two of BWIA's jets and the airline was nearing bankruptcy with total debt of about US$100 million (TT$600 million).
The government considers the airline strategic as it seeks new export markets for its manufacturers and bids to host the headquarters of the Free Trade Area of the Americas, a 34-nation free trade zone scheduled to come online next year.
In recent months, the government has begun subsidizing new BWIA flights to Cuba, Costa Rica and the Dominican Republic.
Caribbean leaders have also pushed to merge BWIA and Antigua-based carrier LIAT, which has also struggled. But Valley said consultants looking at that possibility believe LIAT's operations have to be restructured before a merger can occur, without giving details.
BWIA operates flights to Miami, New York, Washington and 19 other destinations in the Caribbean, Canada, South America and England.
BWIA spokeswoman Dionne Ligoure refused comment Wednesday, saying the company planned to release a statement after it collected all data related to the change in shares.
