Guyana oil surge and Surinam Airways comeback with Turkish support – By Ray Chickrie

  Commentary By Ray Chickrie – 

The government has given ailing state-owned Surinam Airways CEO, Gerard Lau, who took over a few months ago, three years to turn the company around, but with so many changes at SLM, there have been numerous plans by different CEOs to “turn the airline around.” Interestingly, there was no mention of part privatizing the airline or inviting Ethiopian or Turkish Airlines to take part ownership of SLM. This is just wishful thinking.

The old model for the past 30 years hasn’t worked and this is why aviation expert Tomas Clumeckhy is urging the airline to change its business model.

He said, “Surinam Airways can easily be running six to nine aircraft in the next three years, “doing the same things over and over again, and expecting different results” has to stop, the business model is broken, the corporate culture is broken, and there is no vision of the future.”

With mega oil and gas discoveries offshore Guyana, the country will surge economically and this is SLM’s comeback opportunity. SLM’s future depends on the Guiana Shield and Guyana can provide that lifeline for the ailing Suriname airline.   

Guyana, which will soon emerge as an OPEC nation, may be the saviour for SLM.

A smart SLM should connect Paramaribo and Georgetown to Amsterdam, Paris, and London using two Airbus 330s; Belém, Fortaleza, Manaus, Boa Vista, Curacao, Aruba, Port of Spain, Barbados, Bogota and New York. On the New York/GEO route, SLM can carry over 75 percent load factors five times weekly using its two Boeing 737s. This can also be achieved through code-share agreement if the airline effectively uses its fifth, sixth and seventh freedom rights.

Clumeckhy, who has written much about SLM’s history, said that there isn’t much fleet or route reduction that SLM can undertake because the airline has one A340-300, one B737-700 and one B737-300. It needs to expand its fleet and route; and think of itself as a “Caribbean Airline,” he asserted.

“The airline is one of those under-achievers because of its lack of vision and understanding what an airline can do with fifth freedoms, sixth freedoms and even seventh freedoms,” Clumeckhy said.

SLM has fifth, sixth and seventh freedom rights from Guyana. Currently it flies from Georgetown to Miami and Orlando. The airline has been urged to use its fifth freedom to provide NYC with daily service since Guyana is without an airline, and Guyana-based carriers can’t fly to the US nonstop due to its Category 2 status. The airline returned to Guyana after Delta left Georgetown to connect Guyana’s Cheddi Jagan Airport (CJIA) to Paramaribo, Miami and Orlando. The government urged SLM to open a route to NYC from Georgetown. Interestingly, the airline still can’t connect passengers from Belem, Georgetown and Port of Spain with its Amsterdam flight from Paramaribo. This is how backward the company has been.

There is a large Guyanese diaspora community in New York City, Miami, Toronto, Suriname, Barbados and Trinidad and Tobago.

SLM’s Gerard Lau plans to cut unprofitable subsidiaries and reduce staff. The airline seems likely to pick up a renewal plan that may have been left over from former CEO Ewald Henshuijs and the SLM team when he was at the helm of the company. That includes fleet and route expansion. But the airline needs capital and expert skills. It must seek a foreign partner like Turkish Airlines (TK).

Through its membership in the Islamic Development Bank, SLM through the government of Suriname can tap technical support from TK, one of the world top airlines.

SLM was looking to approach the Islamic Development Bank to fund the fleet and route expansion. A lot of money was spent on experts flying into the country to advise the airline about fleet rationalization, route axing and expansion and lining up all flights to connect through a Paramaribo hub. All these expenses could have been avoided if there was a will to tap the Turkish Airlines/ Islamic Bank agreement to support state owned airlines of member states of the OIC, like SLM.

Former Suriname ambassador to the United Nations, Henry MacDonald, would like to see Suriname collaborate with Turkey to improve its aviation and tourism industry. He said that Turkish Airlines plans to make the Istanbul’s airport a new global mega-hub in 2020, which is literally in the centre of the world, since Istanbul lies in Europe and Asia and is just one hour’s flying time from Africa and the Middle East. Turkish Airlines therefore is pushing forward to retain its title as the largest airline in the world, with the highest number of direct long-distance flights.

In 2019, there will finally be a direct flight from Istanbul to Australia. The Istanbul-based carrier currently flies to 199 international and 42 domestic destinations – the most of any on the globe and it’s certainly not planning on stopping there any time soon. The only destination or region where Turkish Airlines is not yet flying direct to is the Caribbean, and Suriname can tap into this unique opportunity because of its close relationship with the OIC and the Islamic development community.

Over and over, we have heard that Guyana and Suriname have no vision how to build an airline and create a hub. Before a country can build a hub, it needs to understand that it needs a dedicated airline to be based in Paramaribo or Georgetown. Thus the government needs to expand SLM and modernize the airport and have the tourism, foreign, transportation and aviation ministries all work to achieve a common goal, but neither Suriname nor Guyana has ever been anywhere close to that.

Before Ethiopian Airlines (ET) made Lome, Togo, a hub, it required a commitment that the government modernize the airport, liberalize the visa regime, and ET took 49 percent of Togo-based Asky Airways, which has expanded routes to all West African capitals.

I flew from Newark to Kampala on TK. On the first leg to Lome, the plane was about 90 percent full; we landed in Lome and most of the passengers disembarked to places like Abidjan, Conakry, Accra, Lagos, etc. From Lome to Addis Ababa, the incoming passengers filled the aircraft and many were going to places like Kenya, Tanzania, South Africa, Zimbabwe, Saudi Arabia, the UAE, India or China. It’s basically a success story because the airline continues to make great profit.

The airline offers passengers free stopovers, visa online, free wi-fi at the airport; and plenty of food. It’s attractive to fly Ethiopian and Turkish Airlines.

Nor will a hub be created Georgetown by American Airlines bringing a A319 four times weekly to Guyana from MIA nor can SLM continue doing the same old; old planes, inflated staff and a handful of historical routes. For too long the transportation and tourism sectors have been urging their respective governments – Guyana and Suriname – to sign more open sky agreements with countries that want to invest.

Neither Georgetown nor Paramaribo, both currently modernizing their airports, will be hub said an Inter-American Bank (IDB) report. Guyana and Suriname cooperation can prove it wrong, but they will need a dedicated airline with more than five aircraft to make either Georgetown or Paramaribo hubs. It will require serious effort from the presidential level, the foreign, aviation and transportation ministries, and the private sector working in unison to seek a foreign and reputable partner with capital and experience.

Born in Guyana, Raymond Chickrie was a teacher in the New York City public school system and has also taught in the Middle East.

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