THERE ARE STILL CRIES of lamentation over the relocation of the heritage Barbados Mutual Sagicor corporate base from Barbados to avoid taxation at a higher level and simultaneously enhance investment prospects for profitability guided by the implications of Standard & Poor’s evaluation rating.
Instant settlement of uncontested charges laid against the rating agency has raised concern for the probity and motive of its assessments as actuation of potential investors.
The relocation of the LIAT hub from Antigua, the original owner of the company, is related in essence to the relocation of Barbados Mutual from Barbados.
Barbados is the major Government shareholder in LIAT. Income tax exemption in Antigua was once its attraction for employees of LIAT.
Reduction in the size of staff concurrent with relocation is no guarantee of a reduction in salaries which are to be adjusted in compensation for loss of concessions previously available in the original location.
Logistically, a Barbados hub for LIAT to serve the southern OECS is of no great advantage when Grenada, St Vincent, St Lucia and Barbados all have operational international airports and accessible direct flights to the region’s tourist markets at one time focused on Barbados and Antigua.
Economically, if Barbados is downgraded for attraction of investment and the Government shareholders in LIAT are themselves dependent on extra-regional investment to capitalise improvements of LIAT’s service intra-regionally, what are the prospects for profitability as the motive for relocation of its hub?
None: Until the Standard & Poors evaluation is challenged and discredited.
– LEONARD ST HILL
