A week or so ago, six tourism ministers visited London as a part of a group co-ordinated by the Caribbean Tourism Organisation (CTO).There they met with ministers, politicians and their industry counterparts. Their principal purpose was to express the region’s deep concern about increases in the United Kingdom’s Air Passenger Duty (APD) and to try to understand the British coalition government’s future policy intentions about aviation tax.
The encounters were about more than just a discriminatory tax. They were a significant demonstration of the Caribbean’s commitment to defend strenuously the interests of an industry that now represents a vital part of the region’s economic future. The meetings also allowed ministers to comment more broadly on a policy that flies in the face of London’s expressed commitment to the development of the region; affects negatively the Caribbean’s community in Britain; and contradicts Britain’s renewed emphasis on the importance of the Commonwealth.
Their visit also enabled them to meet with representatives of nations from Africa, Australasia and elsewhere to begin to multilateralise an issue that is undercutting any remaining sense of a special relationship with Britain.
The meetings in London brought together the tourism ministers of St Lucia, Jamaica, Grenada, Barbados, and St Kitts-Nevis under the leadership of CTO’s Chair-man, Antigua’s Minister of Tourism, John Maginley, with ministers from the UK Treasury, Department for Transport and Foreign and Commonwealth Office. It also enabled a warm encounter with Britain’s first ever Minister of Tourism, John Penrose.
Traditionally tourism ministers have not performed this advocacy or policy-forming role. Instead they have tended to be regarded by many in the region as responsible more for promotional activity or encouraging and incentivising commercial relationships with industry partners.
This visit saw the Carib-bean at its best: an able group of ministers, fact-finding and making clear the region’s deep concern about the effect UK policy was having on the tourism industry and the diaspora, who were, with CTO’s support, both focused and effective.
As a consequence, the Caribbean’s concerns were clearly heard and Caribbean ministers were able to obtain information directly from British ministers about their thinking and to discuss with industry partners how a coalition of interest might be constructed.
The region’s message was specific: the tax was discriminatory; the UK Government may need to raise revenue, but design change was required to ensure APD was less damaging to the Caribbean and its community in the UK; the region should be involved in the consultative process; there needed to be an ongoing dialogue about tourism and it’s relationship to development; the region was concerned about how European schemes to license aviation emissions might relate to UK taxation.
What emerged in London was that the issue of APD revision was as complex within the United Kingdom as it is for the Caribbean or the many other nations across the globe where the tourism industry is touched by the UK tax. The British Government was very aware of the political concerns of the community and the representations they were making to their members of parliament. They wanted evidence of the damage being caused to the region by the tax so that this could be factored in to any revised approach.
What also became apparent was that the internal consideration about a successor arrangement was moving forwards and there would be no change to the swingeing increases that travellers to the Caribbean will face from November 1 of this year. Then passengers to the Caribbean will pay £75 (US$118) per person APD in economy class or £150 (US$236) per person in all other classes resulting in a family of four travelling to the Caribbean paying £600 (US$ 944) in APD alone in the popular premium economy cabin.
This, as tourism ministers heard at public meetings with members of the Caribbean community, was becoming a serious matter for both older and younger members of the community.
Strikingly, at one such meeting the point was made that the Caribbean and its people had given a lot of service to the UK but were now suffering. In retirement, pensions have been hit and the ever increasing taxes on air fares meant that they could no longer afford to go to the Caribbean. The point was also made that many younger members of the diaspora had lost jobs and received pay cuts.
The importance of the APD issue and any successor tax that might follow cannot be overstated. Not only is it about the industry that now underwrites most Caribbean nations, stimulating almost every economic activity, but it goes to the heart of how relationships have changed and the ways in which the region now has to make its case.
Unlike the previous problems with bananas, sugar, rice and rum, that arose out of changing global trade policy and Europe’s wish to end preferential treatment for former colonies, this is an issue that is at the heart of the Caribbean’s ties to the one nation with which it might expect a positive long-term relationship: the United Kingdom.
The discriminatory nature of APD and the disproportionately large increases that travellers to and from the Caribbean will experience this year, undercuts Britain’s expressed desire to support Caribbean economic development, to improve relationships within a Common-wealth context, or encourage investment and trade. It also challenges successive UK governments’ commitment to the interests of a Caribbean community in the UK that for the most part are British citizens and voters.
Tourism ministers and CTO’s commitment to fight the Caribbean’s case on APD is exemplary, but points to the need for a much broader and holistic approach by the region’s governments to tourism and tourism policy. The fight to amend APD argues for significantly more active involvement from ministers of finance, foreign affairs, aviation, and when appropriate, prime ministers.
Previous columns can be found at www.caribbean-council.org
