The International Air Transport Association on Tuesday urged Pakistan and Bangladesh to remove barriers to airlines repatriating ticket revenues after Nigeria released the vast majority of blocked funds.
Pakistan and Bangladesh collectively owe $731 million out of a global total of $1.8 billion in blocked airline funds, according to the world trade body.
Several countries have encountered difficulties repatriating funds due to falls in the value of their currencies, a lack of US dollars, or red tape.
“We are encouraging them to prioritize the airlines’ money because this is very important for their economic and also airline activities,” said Xie Xingquan, IATA’s regional vice president for North Asia.
In Pakistan, the main problem is delays over requirements for airlines to submit audit and tax exemption certificates, he said.
“In Bangladesh, I think the key issue is they just lack the US dollars for foreign currencies,” said Xie.
Nigeria has cleared 98 percent of blocked funds which in June 2023 amounted to $850 million, IATA said Sunday.
“We are on the right path and urge the government to clear the residual $19 million and continue prioritizing aviation,” said Willie Walsh, IATA’s director general.
Carriers had faced problems in repatriating revenues in US dollars from Nigeria after a devaluation of the local currency.
The high volume of blocked funds led some airlines to reduce their operations and one carrier to suspend operations to Nigeria, IATA said.
Egypt also approved the clearance of its blocked funds, IATA said, which combined with Nigeria helped reduce the total backlog by some 28 percent since December last year.
Lebanon, Ethiopia and Algeria are among the other countries that have yet to release funds owed to airlines, according to IATA.
Boeing delays
Headline projections of nearly five billion passengers and close to $1 trillion in revenues this year, both records, were reasons for celebration at the IATA annual general meeting in Dubai.
But the figures would have been stronger without the problems facing Boeing, one of the two major aircraft suppliers along with Airbus, whose safety and manufacturing standards are under the spotlight.
“It is suppressing growth at the moment, without question,” said International Air Transport Association director general Willie Walsh, explaining that delivery delays had been “factored in” to the annual estimates.
Last week, Boeing, at the center of a number of safety incidents, announced more inspectors and improved benchmarks under a “roadmap” demanded by US regulators.
The US aeronautics giant has faced intense scrutiny following manufacturing problems and damning testimony from whistleblowers.
On January 5, a Boeing 737 MAX 9 operated by Alaska Airlines made an emergency landing after a fuselage panel blew out mid-flight. The jet was only delivered in October.
The same model had been grounded after two accidents linked to design defects in 2018 and 2019 which left a total of 346 people dead.
Boeing also suffered production problems last year on the 737 and the long-haul 787 Dreamliner, while deliveries of the 777X are expected in 2025 — six years behind schedule.