BRIDGETOWN, Barbados – Two meetings, crucial to the future of regional air transportation, are scheduled for this week in St John’s, Antigua. They will separately involve the shareholder governments of LIAT, and American entrepreneur Allen Stanford, owner of Caribbean Star.

On Tuesday evening, Stanford, whose airline is currently exploring possibilities for a merger with LIAT, will meet with prime ministers of the three shareholder governments of LIAT – Baldwin Spencer (Antigua and Barbuda); Owen Arthur (Barbados) and Ralph Gonsalves (St Vincent and the Grenadines).

That meeting will be followed by one on Wednesday at which the three prime ministers and LIAT management officials will discuss the LIAT/Caribbean Star proposed merger as one of two strategic options now being pursued.

The other option involves Trinidad and Tobago’s new Caribbean Airlines, which officially replaced BWIA on New Year’s day. This arrangement, it was learnt, could ultimately prove more significant with possible involvement for both LIAT and Caribbean Star.

Prime Minister Gonsalves, who currently has the lead role for regional air transportation, confirmed on Saturday to the Observer that “there are now two strategic options for servicing the region’s air transportation needs and both involve merger proposals”.

While declining to discuss the details, the Vincentian prime minister said that in addition to the LIAT/Caribbean Star merger negotiations, the other initiative being pursued with Caribbean Airlines could be “far reaching” for the future of LIAT in any alliance.

Prime ministers Gonsalves and Spencer had a meeting just over a week ago in Port-of-Spain with Prime Minister Patrick Manning, whose government owns Caribbean Airlines. They discussed a range of options for collaboration between LIAT and the successor airline to BWIA, including code-sharing, route rights and even a possible take-over of LIAT. However, none of the three shareholder governments is said to be ready to offer any public comment ahead of this Wednesday’s meeting in St John’s.

A significant sticking point for any LIAT/Caribbean Star merger, and likely dissolution of LIAT, would be how to deal with LIAT’s heavy indebtedness of over EC$250 million.

This problem, according to insiders, is also related to the merger negotiations between LIAT and Caribbean Star, both of which continue to operate with recurring heavy losses.

The cut-throat competition between LIAT and Caribbean Star that involves some 25 aeroplanes in the sky, could be aggravated when they have to face the coming competition from Caribbean Airlines on routes they currently serve.