The International Air Transport Association (IATA) confirms that as of April 2024, Nigeria clears 98% of airlines blocked funds. The world airline body states that the remaining $19 million is awaiting verification by the Central Bank for forward claims.
“We commend the new Nigerian government and the Central Bank of Nigeria for their efforts to resolve this issue. Individual Nigerians and the economy will all benefit from reliable air connectivity for which access to revenues is critical. We are on the right path and urge the government to clear the residual $19 million and continue prioritizing aviation,” said IATA Director-General Willie Walsh.
IATA, representing 330 airlines, reported a 28% decrease in the amount of airline funds blocked from repatriation by governments. The total blocked funds globally stood at approximately $1.8 billion at the end of April, a reduction of $708 million since December 2023. Three Nigerian carriers IOSA Certified
IATA renewed its call for governments to eliminate barriers to airlines repatriating revenues from ticket sales and other activities, honoring international agreements.
“The reduction in blocked funds is positive. However, the remaining $1.8 billion demands urgent attention,” said IATA. Bilateral agreements ensure airlines can efficiently repatriate revenues, crucial for maintaining economically vital connectivity on thin margins. No business can operate long-term without access to rightfully earned revenues,” Walsh further said.
He confirmed that the reduction was primarily due to a significant clearance of funds blocked in Nigeria. Egypt also approved the clearance of its significant accumulation of blocked funds. However, both cases adversely affected airlines due to the devaluation of the Egyptian Pound and the Nigerian Naira.. Nigeria clears 98% of airlines’ blocked funds.
IATA revealed that Pakistan, Bangladesh, Algeria, XAF Zone, Ethiopia, Lebanon, Eritrea, and Zimbabwe account for 87% of blocked funds. Pakistan and Bangladesh are particularly severe, with airlines unable to repatriate $731 million ($411 million in Pakistan and $320 million in Bangladesh).
According to Walsh, “Pakistan and Bangladesh must release the $731 million immediately to maintain air connectivity.” In Bangladesh, the Central Bank must prioritize aviation’s access to foreign exchange. In Pakistan, finding efficient alternatives to audit and tax exemption certificates is crucial.
While progress has been made in Nigeria, IATA emphasizes the urgency of governments ensuring airlines promptly repatriate revenues to sustain vital air connectivity.
