The bill of Congress that orders a study on the viability of exempting Puerto Rico from air cabotage laws is an important step into the objective of promoting the island´s productivity and competitiveness through a Jones Act waiver.
Specifically, the analysis commissioned to the US Government Accountability Office (GAO) would cover the impact of the creation of a transportation and air-freight hub on the island. The expectation is that the exemption from air restrictions and taxes will generate job creation.
Alaska was already granted an air cabotage waiver, so the island is not requesting an exclusive treatment in that particular issue. Nor does it requests to be exempted from the entire Jones Act, which includes maritime cabotage regulations, the component which includes most of the cargo to the island.
We hope that the analysis will provide the information and the projections that will support the Congress necessary action to promote, through air traffic flexibility, the international exchange from Puerto Rico. The study should also contemplate the use of administrative channels to extend the island's air cargo options conferred by the US Department of Transportation.
A Caribbean air trans-shipment center would facilitate operations of classification, handling and consolidation of goods on the way to or from the United States.
The activity that arises from a model based on the benefits of cargo transfer and air traffic should improve Puerto Rican competitiveness worldwide. Besides, it will promote the creation of jobs in the Caribbean region, due to the impact of exchange at airports in the area.
Puerto Rico is seeking for a model that is already working at the Alaska international air trans-shipment hub. Congress granted the waiver after recognizing that trade in Alaska was affected because it did not share borders with any of the other 49 states. The result was that airports in Alaska experience greater mobility in the distribution of goods. The increase in air flow has stimulated investment in infrastructure and, therefore, economic development.
Alaska represents a good model to evaluate. We hope that the design for our island will also be based on the study commissioned by Congress. The analysis, which was endorsed and promoted by Jennifer González, Resident Commissioner in Washington, instructs the GAO to complete the job in one year.
Part of GAO´s task is to analyze the existing air services at an international level and identify the most active routes, with the largest cargo capacity. Similarly, it seeks to identify those airlines that operate in the regions with the largest movement of goods and those with freight cargo from or to the United States.
Tax on air cargo transfers is one factor that increases costs in Puerto Rico. Its elimination or reduction must also be evaluated. Exploring the convenience of authorizing access to air cargo on passenger aircrafts as well as the transfer of international passengers using Puerto Rico as a bridge should also be explored.
The GAO study presents the opportunity to address one of the aspects of federal commercial traffic regulations that curb development opportunities for the island.
Achieving a waiver from the Jones Act air cabotage regulations would be a good first step towards the goal of achieving balance for Puerto Rico´s growth possibilities. Cooperation of the private sector and the local government will help the study reflect both our needs and our opportunities.
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