Daily Times

The International Air Transport Association (IATA) on Sunday urged Pakistan and Bangladesh to release airline revenues amounting to $731 million to ensure air carriers can continue to provide essential air connectivity.

Pakistan and Bangladesh are on top of a list of eight countries holding 87 percent of the total blocked airline funds for the last 40 months, according to the IATA.

The situation has become “severe,” with airlines unable to repatriate $411 million revenues earned in Pakistan and $320 million in Bangladesh. “In Bangladesh, the solution is in the hands of the Central Bank, which must prioritize aviation’s access to foreign exchange in line with international treaty obligations,” IATA Director-General Willie Walsh said in a statement. “The solution in Pakistan is finding efficient alternatives to the system of audit and tax exemption certificates, which cause long processing delays.”

Others holding airline revenues included Algeria, Ethiopia, Lebanon, Eritrea, Zimbabwe and XAF Zone. However, the IATA reported a 28 percent decrease in the amount of airline funds blocked from repatriation by governments. It said the total blocked funds at the end of April stood at approximately $1.8 billion, down by $708 million since December 2023.

The main driver of the reduction was a significant clearance of funds blocked in Nigeria, according to the global airline body. Egypt also approved the clearance of its significant accumulation of blocked funds.

The IATA reiterated the call for governments to remove all barriers to airlines repatriating their revenues from ticket sales and other activities in accordance with international agreements and treaty obligations. “The reduction in blocked funds is a positive development. The remaining $1.8 billion, however, is significant and must be urgently addressed,” Walsh said.

“The efficient repatriation of airline revenues is guaranteed in bilateral agreements. Even more importantly, it is a pre-requisite for airlines- who operate on thin margins- to be able to provide economically critical connectivity. No business can operate long-term without access to rightfully earned revenues.”