Air Jamaica, CAL takeover talks on track but no announcement until April

The government of Jamaica said Wednesday it would not make any final announcement about the deal with Trinidad and Tobago to take over the debt-ridden national carrier, Air Jamaica.

Air Jamaica lost US$90 million last year and is carrying debt of US$900 million. Under the agreement being negotiation with Trinidad and Tobago's national carrier, Caribbean Airlines, the Trinidad airlines would have an equity stake in the Air Jamaica but would not contribute cash.

However Air Jamaica would need about US$300 million to deal with the redundancy of workers and aircraft that will be taken out of service. The airline would have to reduce about 900 of its 1200 staff.

Jamaican Finance Minister Audley Shaw said negotiations with Caribbean Airlines are continuing and are "on target" added that there will be no announcement before he presents his 2010/2011 Budget scheduled for April 1.

Shaw also said the focus of his government is to negotiate with Trinidad and Tobago and not to pursue a bid by the Jamaica Airline Pilots Association (JALPA) to take over the national carrier.

He explained that the JALPA offer was too late.

"JALPA has been sending correspondence to me and the Prime Minister for some months now but, as we have indicated, their interest, coming as late in the day as it has come, could not be allowed to supersede the procurement process which is clearly established," he said.

He said the only way the Jamaican government would consider discussions with the pilots association is if talks with Caribbean Airlines break down.

He also said another overseas offer for Air Jamaica is not being considered for the same reason.

Trinidad and Tobago Prime Minister Patrick Manning told reporters last month discussions between the two airlines have "a confidentiality clause" so he cannot comment on the deal. He said any comment could prejudice the deal.

Opposition leader Basdeo Panday has demanded full disclosure on the deal. It is taxpayer’s dollars which the government is spending therefore, citizens have a right to know what the government is doing with their money.

"The rumors have been circulating for quite some time yet no one in government has said anything to alleviate the fears of the nation," he said.

Read the story:Panday demands answer about Air Jamaica deal