Banker Mr. Paul Rosdol said yesterday that despite initial excitement, fear of competition from British Airways left the proposed airline without the support of Bermuda's financial establishment.

The airline would have linked Europe and the Caribbean, with Bermuda serving as a hub in the middle.

Work is still being done on the plans, Mr. Rosdol said, and discussions are taking places with possible sources of financing overseas.

If the airline eventually flies -- and it is already too late for this season -- "it may end up being Bermuda-based but it won't be Bermuda-driven, which I think is a great pity'', Mr. Rosdol said.

If the plan had worked, the airline could have provided a solution to the problem of British Airways, which once provided a daily link with London but has gradually been reduced to just two flights a week.

BA cutbacks have been particularly troublesome for international business, which has generally supported Mr. Rosdol's scheme, and importers.

Tourism Minister the Hon. C.V. (Jim) Woolridge said Government is working hard at other ways of increasing air lift from Europe.

"We're in touch with two separate air carriers, and we have had ongoing meetings with them,'' he said. "We are hoping to have some meetings in about two weeks' time. Until we have another meeting, there's very little I can say.'' Although it is too early to tell whether either of these airlines will end up flying to Bermuda, he said, "I hope it's a distinct possibility''. But with British Airways' cuts, he said, "we need to have an alternate source from the UK''.

In the end, according to Mr. Rosdol and others, it was fear of British Airways that scuttled plans for the local carrier.

Mr. Rosdol and his consultants believed the local airline would succeed even if BA increased its flights. But potential local backers -- particularly bankers -- feared it would not work unless BA cut back even more, pulled out of Bermuda altogether, or agreed not to compete.

"Some of the exempted companies were quite happy with it, but the local establishment simply weren't prepared to support it,'' Mr. Rosdol said.

And the exempted companies were not willing to push ahead if local support was lacking, Mr. Rosdol said.

One international business leader, whose company was interested in exploring Mr. Rosdol's idea, agreed that fear over British Airways was the deciding factor for would-be local backers.

Whether or not international companies agreed with the fears, he said, was beside the point: Local banks and other local business leaders had the right and obligation to decide what to do with their own money.

"From the international business point of view, it was a Bermuda project, and if Bermuda banking and business did not wish to support it, then obviously it could not go ahead,'' he said.

"If BA did not wish it to succeed, it would not have succeeded. It's really a matter of judgment, how it would interact with the commercial airlines and how the commercial airlines would react.'' Mr. Rosdol said he is still convinced it is a good plan and could work -- and may still work. But if it does, he said, it will clearly have to be done without Bermuda money.

"The business need is still there, in Bermuda, the Caribbean and in Europe,'' he said. "It's certainly not dead, but it's dead for this season. Next year is another year.''