The International Air Transport Association (IATA) has reported that $1.7 billion in airline funds are still being blocked from repatriation by governments as of the end of October 2024.
Nigeria has been exempted from the debtor countries, an indication that the federal government has settled the outstanding debt balance.
IÁTA, however, described this as a small improvement compared to the $1.8 billion reported at the end of April.
According to the IATA Director General, Willie Walsh, in “the last six months, we have seen significant reductions in blocked funds in Pakistan, Bangladesh, Algeria and Ethiopia, at the same time, amounts are rising in the XAF/XOF zones and Mozambique.
“Bolivia has also emerged as a problem, where repatriating sales revenues is becoming increasingly difficult and unsustainable for airlines. This unfortunate game of ‘whack-a-mole’ is unacceptable. Governments must remove all barriers for airlines to repatriate their revenues from ticket sales and other activities in accordance with international agreements and treaty obligations.
“No country wants to lose aviation connectivity, which drives economic prosperity. But if airlines cannot repatriate their revenues, they cannot be expected to provide a service. Economies will suffer if connectivity collapses. So, it is in everyone’s interest, including governments, to ensure that airlines can repatriate their funds smoothly”.
According to IATA, Nine countries account for 83% of the airline industry’s blocked funds, amounting to $1.43 billion.
The indebted countries include Pakistan which continues to top the list of blocked funds countries at $311 million which IATA described as an improvement from $411 million in April 2024. The main issue is the system of audit and tax exemption certificates which is causing long processing delays.
Bangladesh has seen the amount of blocked funds decreased to $196 million (from $320 million in April).
IATA, however, emphasised the need for Central Banks to continue to prioritize airlines’ access to foreign exchange in line with internationally treated obligations.
About $1 billion of airline money blocked from repatriation is in African countries. That is about 59% of the global tally.
Over the last six months, there were significant reductions in blocked funds in Algeria ($193 million from $286 million in April) and Ethiopia ($43 million from $149 million in April). At the same time, XAF Zone (+$84 million), Mozambique (+$84 million) and XOF Zone (+$73 million) contributed to the largest increases.
Bolivia is new to the list of blocked fund countries. A further deterioration in the availability of foreign exchange, particularly the US dollar, has resulted in an estimated $42 million in airline funds being blocked in the country.
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