The amount of money trapped by foreign airlines in Nigeria has increased to $818.2 million, setting a new world record.
According to Nairametrics, the International Air Transport Association has urged the impacted nations particularly Nigeria to uphold the international agreements made about the repatriation of ticket sales with various governments.
According to the Director-General of IATA, Willie Walsh, as of April 2023, there was $2.27 billion worth of trapped funds worldwide.
“The entire trapped funds in Nigeria was $700 million as of March 2023. However, between March and April, it increased by $118.2 million to $818.2 million.”
Besides Nigeria, IATA listed the following countries as having the most stranded foreign airline funds worldwide: Bangladesh ($214.1 million), Algeria ($196.3 million), Pakistan ($188.2 million), and Lebanon ($141.2 million).
According to IATA, the top five nations are responsible for 68% of all restricted cash worldwide.
Walsh issued a warning that the connectivity of airlines in the impacted markets is in danger due to the quickly rising quantities of trapped funds as he emphasized that from $1.55 billion in April 2022 to $2.27 billion in April 2023, the industry’s blocked funds had increased by 47%.
Additionally, he emphasized that airlines would be unable to continue operating in countries where they had trouble remitting their money and urged prompt resolution of the issue.
“Airlines must stop providing services in markets if they are unable to remit the profits from their business operations there.
“Governments must cooperate with business to find a solution so that airlines can continue to offer the connectivity that is essential for boosting the economy and creating jobs.”
IATA asked countries to uphold their duties under international treaties and accords so that airlines may return the money made from the sale of tickets, cargo space, and other services.
According to IATA, in March, Nigeria had the greatest trapped fund of any country in the world for foreign airlines.
In a discussion with the former minister of aviation, Sen. Hadi Sirika, IATA estimated that Nigeria had $743,731,027 million in trapped funds.
Thus, the association pleaded with Sirika to use his connections to former President Muhammadu Buhari to secure the release of the money, particularly as the administration was coming to an end. The association was managed by its Area Manager in West and Central Africa.
The document, dated March 14, 2023, sent to the Minister of Aviation and signed by Fatokun with the heading “Special Appeal On Airlines’ Blocked Funds in Nigeria,” expressed concern that it could be challenging for the airlines to repatriate the imprisoned funds once the current administration leaves office.
According to the document, Nigeria’s total stranded funds were $662 million in January 2023 and $549 million in December 2023.
