Grenada Airports Authority (GAA) is deliberating on additional cost-cutting measures as the COVID-19 pandemic continues to take a toll on the global travel and tourism industries.
In a release, GAA informed that the cost-cutting initiatives will, in effect, “eliminate its monthly deficit of [EC]$2.2 million.
“The GAA has experienced a significant decline in revenue since the start of
the pandemic as the sharp decrease in the demand for world travel has
triggered reductions in flight operations, causing passenger arrivals through the Maurice Bishop International Airport (MBIA) to be almost non-existent,” the release outlined further.
As a consequence of falling revenues, the authority last year resorted to drawing down on its revenue reserves from previous years to maintain its operation, as well as ensure the implementation of and compliance with COVID-19 safety protocols.
At the same time, the GAA has had to execute cost-cutting initiatives with compromising the safety and security of both aircraft and passengers.
“The GAA has experienced a significant decline in revenue since the start of the pandemic as the sharp decrease in the demand for world travel has triggered reductions in flight operations…”
Over the last year, the GAA has witnessed both aircraft and passenger movements dwindle. Year-on-year aircraft movement reduced by over 50 per cent when comparing the 2019 figure against last year’s. Meanwhile, passenger movement fell by 72 per cent, moving from 447,522 individuals in 2019 to 126,336 in 2020.
“Early predictions of June 2020 being the turning point for the recovery of the aviation industry did not materialise. With the advent of the second wave of the virus, we have seen countries locking down their borders and imposing strict travel restrictions, such as the United Kingdom, which is one of Grenada’s major source markets for visitors,” the GAA explained.
It continued: “Canada has also closed its borders to all Caribbean countries and Mexico. Passenger arrivals from the United States have dwindled to single digits per flight. In neighbouring Trinidad and Tobago, the airport has remained closed to scheduled commercial traffic for the past year. These developments have further postponed Grenada’s recovery, raising an unquestionably high level of uncertainty for the aviation industry.”
Given the continued decline in revenue, the GAA believes it necessary “to introducing more stringent second-tier measures to mitigate significant financial deficit”.
To this end, the GAA has consulted with staff and other stakeholders to develop strategies aimed at cutting back operational costs.
“The GAA has also sought out and received assistance from
Government, which will amount to one million dollars each month, for the
rest of 2021,” the release from the authority stated.
“Based on the extent of the financial fallout from the pandemic and the
correlating impact on its workforce, the GAA will also continue to engage in
discussions with the Grenada Technical and Allied Workers Union, which
represents airport workers,” it added.