The total amount of foreign airlines’ trapped funds in Nigeria has risen to $812.2 million, with the top five countries accounting for 68 percent of the blocked funds.
According to the International Air Transport Association (IATA), these countries include Bangladesh ($214.1 million), Algeria ($196.3 million), Pakistan ($188.2 million), and Lebanon ($141.2 million).
The Switzerland-based trade association of world airlines has expressed concern over the escalating levels of blocked funds, which pose a threat to airline connectivity in affected markets. In April 2023, the industry’s blocked funds increased by 47 percent to $2.27 billion compared to $1.55 billion in April 2022.
Willie Walsh, IATA’s Director General, emphasized that airlines cannot continue to operate in markets where they are unable to repatriate their revenues.
He called for governments to collaborate with the industry to resolve this situation, allowing airlines to maintain vital connectivity that drives economic activity and job creation.
IATA urged governments to honor international agreements and treaty obligations to enable airlines to repatriate funds from ticket sales, cargo space, and other activities.
Kamil Alawadhi, IATA’s Regional Vice President for Africa and the Middle East, stated that the blocked funds in Nigeria had reached $812 million as of April 2023.
He expressed optimism that the new administration led by Bola Tinubu would address the issue and clear the backlog of funds.
The blockage of funds has led to negative perceptions of Nigeria in the global investment community, resulting in high ticket prices.
Alawadhi highlighted the importance of promptly repatriating the funds to support airlines’ operations and foster a favorable investment climate.
IATA is focused on closing the air transport gap in Africa, which accounts for 18 percent of the global population but only 2.1 percent of air transport.
The association aims to achieve this by improving air safety, aviation infrastructure, connectivity, finance and distribution, sustainability, and developing future skills.
Walsh reiterated the urgent need for governments to collaborate with the industry to address the crisis of trapped funds.
He stressed that airlines cannot sustain operations in markets where repatriation of revenues is hindered, underscoring the significance of connectivity for economic activity and job creation.
