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U.S. Dept. of Transportation paves way to ease P.R.’s air cargo, passenger restrictions

The U.S. Department of Transportation has issued the first notice in favor of granting Puerto Rico a waiver to allow foreign airlines to perform certain cargo and passenger transfer services at international airports on the island, local government officials announced.

The federal agency’s decision comes after eight months of analysis, kicking off a 14-day public comment period to then issue a final determination, Department of Economic Development and Commerce Secretary Manuel Laboy said.

Comments may be submitted from Mar. 4-11 at www.regulations.gov in Docket DOT-OST-2019-0085. If approved, the waiver allowing foreign air carriers authorized to serve the U.S. to enable expanded cargo and passenger transfer activities, would be in effect for two years.

“Although this determination is not final, it represents a significant advance for this administration and an eventual economic development tool of great importance,” said Laboy. “It’s also an indication of the restitution of the federal government’s trust in Puerto Rico.”

Once the final determination is received, the island will become the U.S. mainland’s first air hub in the Caribbean. With the two-year authorization, which is the same the term imposed on jurisdictions such as Alaska, Guam and Northern Mariana Islands, Puerto Rico will have the ability to generate more traffic and air cargo, which puts the island in the international spotlight, Laboy said.

Among other things, the local government said the waiver would “support a shift in the growth in passenger and cargo traffic seen now at foreign airports in the region to include the Dominican Republic, Colombia, and Panama to U.S. airports in Puerto Rico.”

“it would also Advance expansion of foreign tourist traffic from Europe to Puerto Rico’s 300 beaches and numerous attractions away from foreign destinations to include Cuba,” the local government said in its petition.

In addition, it will give way to the development of warehouses, manufacturing and other economic activities that will spur an exponential injection into Puerto Rico’s economy.

“It should be noted that subject to the final determination by the federal entity, this approval would be for air cargo and passengers, unlike other jurisdictions mentioned above, whose waiver is only for air cargo,” said Laboy.

Citing a study by the Estudios Técnicos analysis firm, Laboy said the authorization would spur at least 10 new flights per day, which would create more than 900 new jobs and an increase in industry’s payroll of about $30 million.

The waiver was requested for the Luis Muñoz Marín Airport in Carolina, Mercedita in Ponce and Rafael Hernández in Aguadilla.

“This first notification of this important waiver for the transfer of international air cargo and passengers will allow us to continue strengthening the facilities of our three international airports, which will represent greater economic activity and job creation in each one,” Ports Authority Interim Executive Director Joel A. Pizá-Batiz said. “This is a historic event that will foster economic development for our island.”

Laboy said the Department of Economic Development and Commerce will develop a marketing plan to publicize the advantages that Puerto Rico offers the aviation industry. It will also evaluate the viability of the development of duty-free zones, the establishment of warehouses and everything related to the arrival of tourists, increase in commerce and the transportation industry.

The U.S. Department of Transportation granted the petition despite opposition by Air Line Pilots Association, International; Luis Irizarry, an aviation consultant based in Puerto Rico; Delta Air Lines Inc.; the Association of Flight Attendants-CWA, AFL-CIO (AFA); and the Transportation Trades Department, AFL-CIO, which argued that the approval is unnecessary because the island already has the flexibility requested and “the application is an attempt, or at least a first step, by Puerto Rico to gain relief from the prohibition against cabotage.”

Author Details
Business reporter with 25 years of experience writing for weekly and daily newspapers, as well as trade publications in Puerto Rico. My list of former employers includes Caribbean Business, The San Juan Star, and the Puerto Rico Daily Sun, among others. My areas of expertise include telecommunications, technology, retail, agriculture, tourism, banking and most other areas of the economy.

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