Foreign airlines’ trapped funds in Nigeria have risen to $818.2 million, the highest of such a record in the entire world.
This is as the International Air Transport Association (IATA) has called on affected countries, especially Nigeria, to abide by the international agreements reached with various governments regarding ticket sales repatriation.
A statement by Willie Walsh, IATA’s Director-General, put the total trapped funds in the world at $2.27 billion as of April 2023.
As of March 2023, the total trapped fund in Nigeria was $700 million. But it has since risen to $818.2 million between March and April, marking a $118.2 million increase.
Apart from Nigeria, IATA also mentioned Bangladesh ($214.1 million), Algeria ($196.3 million), Pakistan ($188.2 million), and Lebanon ($141.2 million) as nations with the highest trapped foreign airlines’ funds in the world.
IATA explained that the top five countries account for 68 per cent of blocked funds globally.
Walsh warned that rapidly rising levels of blocked funds are a threat to airline connectivity in the affected markets.
He emphasized that the industry’s blocked funds have increased by 47 per cent to $2.27 billion in April 2023 from $1.55 billion in April 2022.
He also explained that airlines could not continue to offer flight services in countries where they have found it difficult to repatriate their funds and called for quick action to address the situation.
“Airlines cannot continue to offer services in markets where they are unable to repatriate the revenues arising from their commercial activities in those markets.
“Governments need to work with industry to resolve this situation so airlines can continue to provide the connectivity that is vital to driving economic activity and job creation.”
IATA urged governments to abide by international agreements and treaty obligations to enable airlines to repatriate these funds arising from the sale of tickets, cargo space, and other activities.
IATA in a meeting with the former Minister of Aviation, Sen. Hadi Sirika, put the figure of trapped funds in Nigeria at $743,731,027 million.
The association, led by Dr. Samson Fatokun, its Area Manager in West and Central Africa, thereby appealed to Sirika to use his closeness with former President Muhammadu Buhari to ensure the release of the funds, especially as the administration was winding down.
The document dated March 14, 2023, addressed to the Minister of Aviation and signed by Fatokun with the head: ‘Special Appeal On Airlines’ Blocked Funds In Nigeria,’ feared that once the present administration leaves office, it may be difficult for the airlines to repatriate the trapped funds.
The document revealed that the total trapped funds in Nigeria as of January 2023 was $662 million, while it remained at $549 million in December 2023.
However, IATA lamented that the sums had increased to $743,721,027 million within two months in 2023, indicating about an $81 million increase within the period.