Out of $2.36 billion globally, a total of $1.68 billion in airline funds are blocked across Africa, according to the most recent data from the International Air Transport Association.

0

Speaking at the 55th AFRAA AGM, which took place in Entebbe, Uganda on November 18, 2023, Kamil Alawadhi, Regional Vice-President for Africa and the Middle East at the International Air Transport Association (IATA), said that the numbers are concerning and that this is having a disastrous effect on connectivity.

1

Aviation is capital-intensive. Cash flow is key for airlines’ business sustainability – when airlines are not able to repatriate their funds, it severely impacts their operations and their decisions on where to fly. But the risk of blocked funds is not just limited to airlines; the negative impact extends to the countries blocking the funds."

2

"It impacts the country’s economy and its connectivity, and it hurts investor confidence and reputation. Aviation is not only an economic enabler; it is a pillar of modern economies.”

3

He called on African governments to prioritize aviation and seek sustainable solutions to address the issue of blocked funds. Additionally, he emphasized that IATA would continue to provide support in any possible way.

4

Blocked funds, as seen in Nigeria, contribute to elevated airfares, as airlines adjust prices upwards for sales made outside the country to sustain their operations and competitiveness.

5

Approximately US$1 billion is held up in 12 African countries, with Nigeria, Zimbabwe, Algeria, and Eritrea being among the nations facing significant challenges.

6

In Ghana, the positive working relationship between the government and airlines has prevented disruptions in the operations of international airlines at Kotoka International Airport. This stands in contrast to Nigeria, where some international airlines have signaled a reduction in frequency due to ongoing issues with blocked airline funds.

7

Cathrine Wesley, Country Manager of Emirates Airlines, highlighted this issue in a previous interview with AviationGhana.

8

“We have an excellent relationship with the Ghana Government. We have an excellent relationship with the Ministry of Transport, and the Ministry of Foreign Affairs [ in the movement of funds]. For Emirates Ghana, we are extremely fortunate to have the relationship that we have with the Ghana government and we don’t have any of those issues [blocked airline funds].”

9

10