21 Feb 2012

Cooks airline subsidy balloons after fuel price hike

6:22 pm on 21 February 2012

The Cook Islands government says a 50 percent blowout in the cost of guaranteeing Air New Zealand flights to Sydney and Los Angeles is due to the high price of aviation fuel.

The government is facing a deficit this year after increasing the allocation for the flights to ten and a half million US dollars.

The Minister for Finance and Economic Management, Mark Brown, says the guarantee covers any shortfall on flights that are vital to the country's tourism industry.

"Especially the one from Los Angeles; it's basically our only direct gateway for our visitors from North America and also from Europe. And increasingly, as we try to build market share from the Australian market, the direct Sydney to Rarotonga flight is very important."