$1bn global airlines fund still blocked In Africa – IATA

The International Air Transport Association (IATA) has disclosed that African countries still owe foreign airlines at least $1 billion in repatriation funds, representing 73 percent of total global blocked funds.

This staggering amount is spread across 26 African countries, posing a significant impediment to maintaining Africa’s international connectivity.

According to Somas Appavou, IATA’s Regional Director, External Affairs, Africa, airlines facing blocked funds often reduce flight frequencies or suspend routes, which can have far-reaching consequences for the economy and society.

“Airlines cannot operate in a market if they are unable to repatriate revenues generated, which are guaranteed in international treaties and bilateral agreements,” Appavou emphasised.

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The blocked funds issue is not new, but solving it is urgent. IATA launched the Focus Africa initiative in 2023 to work hand-in-hand with governments, industry, and development partners to deliver real improvements in safety, affordability, and connectivity.

“Aviation is not a luxury. It is an economic and social lifeline. Focus Africa is about turning potential into jobs, growth, and prosperity,” Appavou said.

Appavou called on African governments to prioritise aviation as a catalyst for economic growth, job creation, connectivity, and social development.

He highlighted the significant contribution of aviation to Africa’s economy, with the sector contributing $75 billion to the Gross Domestic Product (GDP) and supporting 8.1 million jobs. The continent’s aviation market is projected to grow at 4.1 percent over the next 20 years, doubling by 2044.

However, Appavou noted that African safety rates lag behind the global average in implementing International Civil Aviation Organisation (ICAO) Standards and Recommended Practices (SARPS).

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The effective implementation rate for ICAO SARPS is 59.49 percent across 46 of 48 Sub-Saharan African states, behind the global average of 69.16 percent and the global target of 75 percent.

To address these challenges, IATA recommends that African governments remove barriers to airline revenue repatriation, prioritise aviation as a catalyst for economic growth and social development, implement global safety standards, reduce taxes and charges on air travel, which are 15 percent higher than the global average and invest in growth-supporting infrastructure that is cost-efficient and scalable

By addressing these issues, African governments can unlock the full potential of aviation to drive economic growth, create jobs, and improve connectivity.

“The greatest value that aviation brings to an economy is catalytic. Transporting travellers and goods stimulates job creation, and destroying demand with excessive taxation puts a brake on economic and social development,” Appavou said.