The International Air Transport Association (IATA) on Sunday urged Pakistan and Bangladesh to release airline revenues totaling $731 million to ensure that air carriers can continue providing essential air connectivity.
According to the IATA, Pakistan and Bangladesh top the list of eight countries holding 87 percent of the total blocked airline funds over the past 40 months. Airlines have been unable to repatriate $411 million from Pakistan and $320 million from Bangladesh, making the situation “severe.”
IATA Director-General Willie Walsh stated that the solution in Bangladesh lies with the Central Bank, which must prioritize aviation’s access to foreign exchange in accordance with international treaty obligations. In Pakistan, the issue involves finding efficient alternatives to the current system of audit and tax exemption certificates, which cause long processing delays.
Other countries holding airline revenues include Algeria, Ethiopia, Lebanon, Eritrea, Zimbabwe, and the XAF Zone.
The IATA reported a 28 percent decrease in the amount of airline funds blocked from repatriation by governments, with total blocked funds at the end of April standing at approximately $1.8 billion, down by $708 million since December 2023. The primary driver of this reduction was the significant clearance of funds previously blocked in Nigeria. Egypt also approved the release of a substantial accumulation of blocked funds.
The IATA reiterated its call for governments to remove all barriers preventing airlines from repatriating their revenues from ticket sales and other activities, in line with international agreements and treaty obligations.
“The reduction in blocked funds is a positive development. However, the remaining $1.8 billion is significant and must be urgently addressed,” Walsh said. “The efficient repatriation of airline revenues is guaranteed in bilateral agreements. More importantly, it is essential for airlines, which operate on thin margins, to provide economically critical connectivity. No business can operate long-term without access to rightfully earned revenues.”