Saint Lucia not acceding to Virgin Atlantic subsidy demands

Virgin Atlantic Airways has announced that it will cease operations to St. Lucia effective June 7th 2020. This after dialogue with government over airline subsidy failed to arrive at an arrangement.

A government press release reveals that Virgin Atlantic Airways wants EC$20 million or USD7.5 million over three years in order to continue operating its existing five flights weekly in the winter months, and three in the off season summer months.

Tourism Minister Dominic Fedee notes that “Two other options were presented to us which would mean a significant reduction in Virgin Atlantic flights to our shores and did not present the best return on a potential investment”.

The Minister also feared that “agreeing to Virgin Atlantic’s demands for a multimillion dollar subsidy, would have opened the door for other airlines to also ask for subsidy. In fact, upon hearing the news that Virgin Atlantic has requested subsidies from four Caribbean governments, namely Grenada, Tobago, Antigua and St. Lucia, other airlines have been in talks with respective governments”. 

Mr. Fedee goes on to say that “While the Government of Saint Lucia appreciates the need for governments to share the financial risk on new flights until the maturing of the route, Virgin’s requests goes against our principle having been in Saint Lucia for 21 years” 

The Tourism Minister went on to disclose that “Saint Lucia presently supports Virgin Atlantic flights with marketing agreements annually but presently has no subsidy arrangements with any airline in any other tourism market”.