SUNBIZ

Government Subsidy For Domestic Air Fare

The Attorney-General and Minister for Finance, Aiyaz Sayed-Khaiyum, has stressed the cost of domestic air fares would be higher had it not been for the Government subsidy. His comments followed
17 Aug 2015 12:59
Government Subsidy For Domestic Air Fare
Attorney-General and Minister for Finance, Aiyaz Sayed-Khaiyum. Photo: DEPTFO News

The Attorney-General and Minister for Finance, Aiyaz Sayed-Khaiyum, has stressed the cost of domestic air fares would be higher had it not been for the Government subsidy.

His comments followed a question during the Fiji Business Forum on Saturday asking why the domestic air fares were so costly.

Mr Sayed-Khaiyum stated Government gives annual subsidy for domestic air travel.

He said this year, Government had given about $1.6 million as part of this subsidy.

“For example if you were going to Ono-i-Lau – the ticket fare would be something like $3000 to $4000,” he said.

“The reality is this, there is no volume, there is no fuel depot in Ono-i-Lau for example.

“So the aircraft has to carry enough fuel to go and come back. Which means it can carry only few a passengers.

“So the cost of them running that flight to Ono-i-Lau is very expensive and they won’t fly unless we subsidise it.”

Mr Sayed-Khaiyum said Government subsidises all air routes except Labasa, Nadi and Suva.

But despite this, the Minister stressed competition in the industry will be good.

Currently there are two domestic operators – the Fiji Airways subsidiary Fiji Link and the much-smaller Nausori-based Northern Air.

 

Inter Island

And while another airline, Inter Island Airways (Fiji) Limited, had been given a licence, Mr Sayed-Khaiyum said they have not come through.

There seems to be some obvious disconnect

The airline’s licence to operate has expired, as per earlier confirmation by the Air Transport Licensing Board, following its non-commencement of operations in Fiji.

Inter Island Airways, according our earlier reports, was supposed to have commenced its operations here back in 2013.

It is understood the Los Vegas Aviana Airways managed airline had faced some financial constraints and difficulties in American Samoan operations.

The airline however has posted on its website that it will launch late this year and begin flying between seven domestic airports/destination from Nadi and Suva by 2016.

It says it is close to completing its certification from the Civil Aviation Authority of Fiji.

Feedback: rachnal@fijisun.com.fj

 

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