Nigeria leads countries owing foreign airlines, its debt soars to $812m

Nigeria with a huge $812.2 million debt maintains its lead among countries owing foreign airlines collectively about $2.3 billion.

The $812.2 million foreign airlines’ revenues are stuck in Nigeria and it is followed by Bangladesh with $214.1 million, Algeria with $196.3 million, Pakistan with $188.2 million and Lebanon with $141.2 million, data gathered by Per Second News have shown.

The humongous $2.3 billion owed by governments around the world is depriving the aviation industry of the much-needed cash, the International Air Transport Association (IATA) said on Sunday.

Algeria has been “slow” in releasing funds, while Lebanon is facing a “complete collapse in the financial industry” but is still working with IATA to resolve the issue, Kamil Al Awadhi, regional vice president of Africa and the Middle East, told reporters at the 79th annual meeting of the association.

Nigeria has been responsive to IATA’s prompting to address the problem until about six months ago with the election of a new government, he said.

“They still have to look at what they’re doing to their own economy and to the aviation industry,” Mr Al-Awadhi said. “This is beginning to bite.”

Blocked remittances have plagued airlines for years but the situation has been exacerbated by the Covid-19 pandemic, which left airlines strapped for cash after about three years of weak travel demand.

“Airlines can’t keep funding this … the aviation industry just came out of the worst disaster ever seen in the 100 years it existed, that means they’ve come out with very little cash, every penny counts now and they can’t wait,” Mr Al Awadhi said.

According to him, Nigeria’s continued blocking of funds is putting airlines in a “tighter position” with some carriers forced to temporarily suspending or reducing services as they cannot continue to fund the operations.

Nigeria’s decisions to continue blocking funds reduces air connectivity, creates negative perceptions about the business environment, raises ticket prices, discourages investors and hurts the country’s travel agents’ business, he added.

The IATA official said he hoped the new government in Nigeria will take “positive measures to remedy” the problem as soon as possible.