IATA warns that billions in blocked airline funds threaten global connectivity, increase fares, and hinder economic growth
The International Air Transport Association (IATA) has raised concerns over billions of dollars in blocked airline funds, warning that international carriers face mounting financial pressure that could disrupt global connectivity and economic growth.
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Thomas Reynaert, Senior Vice President, External Affairs at IATA, said the issue arises when airlines earn revenues in local currencies but cannot repatriate the funds to their home countries due to foreign-exchange restrictions.
“Imagine running a business where you sell your products in certain markets, but access to your revenue is not guaranteed. For many airlines, this isn’t hypothetical; it’s a reality,” Reynaert said.
Blocked funds refer to revenues earned from ticket sales that cannot be converted into US dollars because of government-imposed restrictions or currency shortages.
While airlines operate across multiple countries, major costs such as aircraft leases, fuel, maintenance, and salaries are paid in US dollars, creating operational challenges when funds are trapped abroad.
Reynaert warned that as of October 2025, airlines globally had about $1.2 billion in blocked funds.
Delayed repatriation exposes airlines to currency depreciation, higher borrowing costs, and reduced capacity to invest in fleet expansion, route development, and sustainability projects.
“This is what we can call the ‘connectivity risk premium’. Airlines often respond by reducing flights, raising fares, or suspending routes entirely, making affected countries less attractive to serve,” he said.
Highlighting Nigeria as a case study, Reynaert noted that blocked funds there once reached $850 million. The resulting spike in ticket prices and route suspensions hindered both travel and trade.
Air transport remains a critical driver of the global economy. In 2023, aviation supported 86.5 million jobs worldwide, contributed $4.1 trillion to global GDP, and carried 33 percent of trade by value, moving goods worth $8 trillion.
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“Blocked airline funds are not just a financial problem for carriers; they have a ripple effect across economies, jobs, and global trade,” Reynaert added.
