By Chinelo Obogo
The International Air Transport Association (IATA) warned that the amount of airline funds for repatriation being blocked by the governments of 27 countries has risen by more than 25 per cent ($394 million) in the last six months with Nigeria topping the list.
The global body said total funds blocked now tally at close to $2.0 billion and called on governments to remove all barriers to airlines repatriating their revenues from ticket sales and other activities, in line with international agreements and treaty obligations.
IATA in a press statement said the top five markets with blocked funds (excluding Venezuela) are: Nigeria: $551 million, Pakistan: $225 million, Bangladesh: $208 million, Lebanon: $144 million and Algeria: $140 million.
The body said in Nigeria, total airline fund blocked from repatriation stands at $551 million.
IATA’s Regional Vice President for Africa and the Middle East, Kamil Al-Awadhi, said: “Repatriation issues arose in March 2020 when demand for foreign currency in the country outpaced supply and the country’s banks were not able to service currency repatriations.
“Despite these challenges Nigerian authorities have been engaged with the airlines and are, together with the industry, working to find measures to release the funds available.
“Nigeria is an example of how government-industry engagement can resolve blocked funds issues. Working with the Nigerian House of Representatives, Central Bank and the Minister of Aviation resulted in the release of $120 million for repatriation with the promise of a further release at the end of 2022. This encouraging progress demonstrates that, even in difficult circumstances, solutions can be found to clear blocked funds and ensure vital connectivity.”
IATA is also renewing its calls on Venezuela to settle the $3.8 billion of airline funds that have been blocked from repatriation since 2016 when the last authorisation for limited repatriation of funds was allowed by the Venezuelan government.
“Preventing airlines from repatriating funds may appear to be an easy way to shore up depleted treasuries, but ultimately the local economy will pay a high price. No business can sustain providing service if they cannot get paid and this is no different for airlines. Air links are a vital economic catalyst, and enabling efficient repatriation of revenues is critical for any economy to remain globally connected to markets and supply chains.
“Airlines have also restarted efforts to recover $3.8 billion of unrepatriated revenues in Venezuela. There have been no approvals of repatriation of these airline funds since early 2016 and connectivity to Venezuela has dwindled to a handful of airlines selling tickets primarily outside the country…”