Bangladesh ranks the second highest in blocking airline funds across the globe as the amount of blocked funds in the airline industry has increased by 47 per cent, reaching $2.27 billion in April 2023 compared to $1.55 billion in April 2022.
According to the International Air Transport Association (IATA), Bangladesh has withheld approximately $214 million in airline blocked funds, making it the second-worst performing country in the world in this regard.
Of the entire blocked funds, the top five countries account for 68 per cent. These nations are as follows: Nigeria with $812.2 million, Bangladesh with $214.1 million, Algeria with $196.3 million, Pakistan with $188.2 million, and Lebanon with $141.2 million, according to an IATA release.
The IATA has cautioned that the escalating levels of blocked funds pose a significant threat to airline connectivity in the affected markets, as stated in an IATA release on Sunday.
Since its establishment with 57 founding members in 1945, the IATA has grown to represent around 300 airlines across more than 120 countries. These members encompass the world’s leading passenger and cargo airlines, collectively accounting for 83 per cent of global air traffic.
IATA has played a vital role in fostering the development of commercial standards that form the foundation of the global air transport industry.
IATA Director General Willie Walsh expressed concern, stating, “Airlines cannot continue to offer services in markets where they are unable to repatriate the revenues arising from their commercial activities in those markets.”
He called on governments to collaborate with the industry to resolve this situation promptly, enabling airlines to provide vital connectivity that drives economic activity and job creation.
The IATA also emphasised the importance of governments adhering to international agreements and treaty obligations, facilitating the repatriation of funds generated from ticket sales, cargo space, and other activities.
Civil Aviation Authority of Bangladesh Chairman Air Vice Marshal M Mafidur Rahman told The Business Post that the situation follows the dollar crisis prevailing across the globe.
“We are in discussion with ministries concerned including the finance ministry over the issue. I think the problem will be solved when normalcy returns to the economy,” he said.