Global carriers warned yesterday that concerns over blocked airline funds in Africa and elsewhere could lead to interruptions in air services if there is no progress in talks to unfreeze money owed.
About $1.6 billion of funds are being withheld in various Africa countries due to currency shortages or other problems, the International Air Transport Association said in a briefing on the launch of an initiative to boost African aviation.
“The people who suffer as a result of these blocked funds are consumers in these markets, because you cannot expect airlines to continue to provide services if in effect they’re not being paid,” IATA director general Willie Walsh said.
The issue of airline funds’ being blocked in some countries where carriers operate has been rising as demand for hard currency outpaces supply, with IATA stepping up efforts to whittle down a deficit that grew 25 per cent in the last six months of 2022 alone.
According to the Genevabased body, which represents most of the world’s major airlines, Nigeria tops the list of countries holding back funds, with Algeria and Ghana also involved.
A total of $2.4bn is being blocked worldwide. Nigeria faces severe shortages of foreign currency, meaning airlines cannot easily convert local currency to repatriate revenues earned from ticket sales by foreign airlines.
Aviation Minister Hadi Sirika has said he can only continue to urge the central bank to make dollars available to airlines. A spokesperson for the Central Bank of Nigeria did not immediately respond to a request for comment yesterday.
About half the $1.6bn frozen in Africa is tied up in Nigeria, RwandAir CEO Yvonne Makolo told the IATA briefing. Makolo, designated as the next chairperson and first female leader of the board of the influential IATA, also called for faster progress towards setting up a common aviation market in Africa.
Efforts to liberalise flying have been under discussion since a landmark treaty known as the Yamoussoukro Declaration in 1988, which was updated 11 years later.
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