CHANNEL Islanders are ‘living in a dreamland’ if they believe that we will not be affected by the recession, according to one of Guernsey’s most successful businessmen.

But Derek Coates thinks that closer union between the islands will mitigate some of the effects of the economic crisis. Mr Coates, the chief executive of Healthspan and the chairman of airline Blue Islands, made the comments while addressing members of Jersey’s Institute of Directors, at their first lunch meeting of the year.

Mr Coates, who spent his teenage years in Guernsey, retired at the age of 39 after a career in advertising and marketing. But after returning to Guernsey in 1988 he founded Healthspan in 1996 and bought airline Rockhopper ten years later, which he renamed Blue Islands. He now employs over 400 staff.

Mr Coates told a packed room at the Grand Hotel that while he is keen for Guernsey to compete with Jersey at the Muratti, he believes there are ‘many things which we should be doing together’. And he said that a leading Guernsey civil servant told him recently that it is ‘highly unlikely’ that Protocol 3 of the Treaty of Rome – which defines the Crown dependencies’ relationship with the European Union – will exist in ten years’ time. In preparation for this, Mr Coates said he believes that Jersey and Guernsey will have to come together, ‘in order to survive’.

• Picture: Guernsey resident Derek Coates, founder of Healthspan and owner of airline Blue Islands