'London City loss is dreadful news for our economy'

Aurigny has announced plans to drop the route just two years after it was launched, saying it operates at less than 50% capacity and was not commercially viable.

Cutting the route will save the States-owned operator a 'substantial' amount of money, it added.

However David Oxburgh, chairman of the Guernsey International Business Association, said it was a lifeline route for the finance sector and was becoming increasingly popular.

'This is dreadful news for Guernsey as a whole and has the potential to have a significant adverse impact on the development of our economy,' he said.

'Although the route was not as well supported as might have been hoped, it is still a vital link for London and international colleagues and customers of those working in the finance sector here. The route has had more than its share of problems, but despite this passenger numbers have been growing and with better servicing and marketing will continue to build.

'With roughly half the employment taxes coming from those working in the finance sector, this rather smacks of killing the goose that lays the golden egg.

'Hopefully, the Committee for Economic Development can see the benefits of supporting an operator on this route under a public-service agreement and will be able to act quickly to address this.'