Planes have been seized

BWIA faces bankruptcy unless the government, a one-third shareholder, the airline, and the International Leasing and Finance Company (ILFC) reach an agreement over millions in outstanding fees.

"BWIA directors indicated to the government that what we are dealing with is an out-and-out bankruptcy," said Planning and Development Minister Keith Rowley.

Last week the ILFC, one of the world's two biggest aircraft leasing companies, seized two of BWIA's Boeing 737s in Miami.

The government gave the loss-making airline millions in aid after the seizure.

BWIA blames its financial troubles on high insurance and security costs, and a drop in passenger numbers after the 11 September attacks.

No protection

ILFC, which leases seven of BWIA's eight planes, had demanded a payment of 33m Trinidad dollars (�3.3m; $5.4m) by Tuesday, Mr Rowley said.

The airline owes the company about T$122m, and other creditors a further T$590m, he said.

The government, which is under pressure to take over the whole airline, hopes it can delay the seizure of the remaining planes.

BWIA said on Tuesday no more planes had been seized.

Under Trinidad's bankruptcy protection laws, creditors must take legal action in order to recover their money.

Mr Rowley said the government would like to keep BWIA flying but had limited resources.