Blocked airline funds are one of the six main challenges at play in the Sadc region, according to the International Air Transport Association (Iata). Six of the top-10 countries whose governments are blocking the most airline funds from being repatriated are in Africa, and Mozambique tops the list.
The blocked funds are from sources such as revenue from ticket sales, Iata said. Mozambique was blocking $205m in airline funds by the end of April. Africa and the Middle East (AME) region accounts for 85% of total blocked funds, at $1.1bn of the global total of $1.3bn withheld as at end-April 2025.
Other African countries in the top-10 list are Algeria ($178m), Angola ($84m), Eritrea ($76m), Zimbabwe ($68m) and Ethiopia ($44m).
At its AGM and conference in Delhi, India, Iata urged governments to remove all barriers preventing airlines from the timely repatriation of their revenue from ticket sales and other activities, in accordance with international agreements and treaty obligations.
“Ensuring the timely repatriation of revenues is vital for airlines to cover dollar-denominated expenses and maintain their operations. Delays and denials violate bilateral agreements and increase exchange rate risks,” Iata director-general Willie Walsh said.
“Reliable access to revenue is critical for any business — particularly airlines, which operate on very thin margins. Economies and jobs rely on international connectivity. Governments must realise that it is a challenge for airlines to maintain connectivity when revenue repatriation is denied or delayed.”
The position of the Airlines Association of Southern Africa (Aasa) is aligned with that of Iata, according to Aasa CEO Aaron Munetsi, who says “blocked funds are one of the biggest challenges any airline can face, having a direct and immediate adverse impact on any airline’s cash flow”.
“Cash flow is the lifeblood of any airline given the razor-thin margins they are contending with. Our mission is to engage with the authorities in the respective country, in this case Mozambique, so that we propose solutions for all our member airlines conducting business in that country,” Munetsi said.
Aasa proposes working with Iata to engage with the Mozambique authorities to agree on a blocked funds release programme and ensuring that current sales are immediately made available for repatriation by the airlines.
Aasa would like to see Mozambique allowing airlines to sell in forex with immediate effect and airlines, in turn, being allowed to sell in Forex for the equivalent of their blocked funds.
A second issue that is important for Aasa to address is infrastructure, Munetsi told Business Day on the sidelines of the Iata conference. “Irrespective of who provides the infrastructure, whether airports, aviation navigation service providers, ground handling or technical services, airlines are facing a big infrastructure challenge: they have no option but to pay the respective service providers. If they don’t pay, they are grounded or denied access to these facilities. And yet, what ever they are paying for, is not provided as per their agreements,” Munetsi said.
“Aviation navigation services is not only a problem in SA, but in most of the jurisdictions in the Sadc for that matter. Facilities are not up to standard and yet our airlines pay for them,” he said.
The other issue around infrastructure is creating as smooth as possible a process for passengers.
A third Sadc aviation challenge relates to policy matters. For example, SA is currently dealing with its National Aviation Policy and Aasa members have been very vocal about a number of elements in the policy that either need review or to be completely revamped.
Some of those policies were formulated in the 1990s.
“We need standardisation of most of the policy matters, not only within the Sadc region but across the whole African economy. For example, relating to foreign operating permits, one country might be charging an arm and a leg, while another charges a nominal fee. Then that becomes almost like an anticompetitive edge that is used by other countries to try to block airlines, especially those operating from SA into those countries,” Munetsi said.
“We need to make sure that those policies are updated so that they can talk to the overall policy or policy objective of increasing connectivity.”
A fourth challenge relates to fees, taxes, charges, levies and air service charges.
“There is no correlation between what our passengers are paying, what our airlines are paying and the policies. On the other hand, when we all agree that we need to improve connectivity on the continent, we need to make sure we understand the cause of the taxes, fees, charges, levies and aviation service charges. By overcharging passengers, travel is not incentivised and traffic stabilised,” said Munetsi.
The fifth challenge relates to digitisation and the continued use of paper-based processes in aviation on the continent, preventing digitisation from being an enabler for the aviation industry, including in relation to the customer experience as well as safety.
Last, and another big challenge for aviation in the Sadc, is the lack of connectivity. Iata’s research shows that Africa lags in this regard. That is why Aasa is trying to reach out to more than just its usual government stakeholders to include talks with the finance and trade and industry ministries, to make sure they understand the role aviation can play as an economic enabler.
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