AIG chief executive Willie Walsh has not ruled out cutson routes to the Caribbean from the UK if APD increases come into effect. The airlineboss said today that if the tax continues to rise into 2015, the carrier could beforced to drop some long-haul flights, as well as slow growth to services inemerging markets such as India and China. “It’s [tax] is damaging the sector,you cannot lose 7.3 million passengers and say that’s okay,” Walsh explained atthe ABTA Travel Convention. “Passenger levels from the UK were higher in 2004and if APD doubles by 2015 it will reduce the network of destinations servedfrom Heathrow and other UK airports. We are turning away economic opportunitiesand other airports in Europe are delighted at the situation”. Walsh said therecent reduction in APD from Belfast was evidence to the damage caused by thetax and urged the industry to not lower the tax but rid of it completely. Walshlaid further attack into the government by criticising transport minister PhilipHammond but agreed the government needed to make cut backs. “Philip Hammond isnot interested in transport, he is interested in reducing the deficit,” hesaid. Meanwhile, Walsh warned that the industry should not get too caught up inthe recession and IAG’s profits this year had increased compared to last yearand ‘significantly’ on 2009’s. “When I talk to businesses I think people aregenerally optimistic but there is so much doom and gloom that companies holdback on what they want to do,” he explained. “There is a real concern that we’retalking ourselves into a recession that doesn’t exist”. On BA’s tie-ups withother airlines, Walsh said he had identified Latin America and Asia as keygrowth areas, but was patient about what it would do in the future. He namedTAP’s network as an interest, as well as bmi should Lufthansa decide to sell itoff.