Airline industry's $1.7bn in blocked funds threaten global connectivity, Iata warns

Governments worldwide are blocking $1.7b in airline funds as of October's end, threatening global aviation connectivity, according to a report by the International Air Transport Association. While this marks a slight improvement from $1.8b in April 2024, the issue remains critical as airlines struggle to access revenue from ticket sales and other operations. Nine countries accounting for 83% of the airline industry’s blocked funds, amounting to $1.43b, include Pakistan, Bangladesh, and several African nations, Iata said. Pakistan alone accounted for $311m in blocked funds, however that's down from $411m in April. In Pakistan, the main problem is the system of audit and tax exemption certificates, which is causing long processing delays, said Iata, which represents nearly 340 airlines comprising over 80% of global air traffic. Iata’s director general Willie Walsh urged governments to uphold their treaty obligations and enable the repatriation of airline funds, warning that any delay could jeopardise aviation connectivity and harm local economies. He said airlines cannot be expected to maintain services if they are unable to access their own revenue. “This unfortunate game of ‘whack-a-mole’ is unacceptable. Governments must remove all barriers for airlines to repatriate their revenue from ticket sales and other activities in accordance with international agreements and treaty obligations. No country wants to lose aviation connectivity, which drives economic prosperity. But if airlines cannot repatriate their revenue, they cannot be expected to provide a service. Economies will suffer if connectivity collapses. So it is in everyone’s interest, including governments, to ensure that airlines can repatriate their funds smoothly,” Walsh said.<br/>