US$3 levy to be charged on airline tickets for persons travelling to the OECS


The implementation of a US$3 levy on airline tickets for persons traveling to the Organization of Eastern Caribbean States (OECS) and the wider Caribbean originating in overseas markets was among decisions taken at last week joint meeting of the OECS Authority and the Eastern Caribbean Central Bank (ECCB) Monetary Council.

The meeting, which was attended by all OECS prime ministers and ministers of finance, agreed on a number of short, medium and long strategies to cope with the effects of the financial downturn in the tourism sector as a means of minimizing the implementation on the regional tourism industry.

The participants agreed in principle that the proceeds of the levy will be used to establish a sustainable funding mechanism to ensure adequate public funding of regional market campaigns.

Member states, according to the a joint statement issued following the meeting, acknowledged that the impact of the global financial and economic crisis on member countries was grave and given the scale and scope of the international crisis there is the possibility that it will be prolonged.

Participants agreed how important it was to undertake appropriate policy measures to deal with the effects of the crisis and to position the countries to take advantage of the recovery when it comes.

For the tourism sector, it was agreed that in the short term member states would provide a short-term tax relief package to the hotel industry tailored to the individual circumstances of individual member states, on condition that the industry takes proactive innovative measures to preserve employment levels, increase operating efficiency and reduce operating costs.

“Member governments will strengthen markedly, their partnership with the industry in supporting marketing, product enhancement and other facilitating measures that position the industry to respond readily when the tourism source markets recover,” said the participants in the joint statement, which explained that the sector’s performance in 2008 reflected a significant downturn, resulting in job losses and cutbacks in hotel development projects.

Accepting that projections for 2009 will significantly slowdown because of the downward trends and that the recession will continue to affect major tourism source markets, the agreed that the medium to long term member states will establish an “Executive Committee of Ministers of Tourism” to oversee and give direction to the long term OECS tourism development agenda.

“Member states agreed in principle, subject to the determination of the specific functions and cost of operations, to the possibility of setting up an OECS Tourism Authority with the capacity for planning, coordinating, regulating, marketing and research and development, which will initially function as a secretariat to the executive committee of ministers,” they added.

The proposed Tourism Authority will initially play a coordinating role, working in tandem with OECS ministries of tourism, and drawing on the resources of the ECCB and the OECS Secretariat.