Unblocking airline funds can boost economy; enhance connectivity

IMAGINE running a business where you sell your products in certain markets but access to your revenue was not guaranteed.

- THOMAS REYNAERT

INTERNATIONAL airlines and investors see blocked funds as a warning sign of financial instability, says the writer.

(ARMAND HOUGH)

Would you keep operating there?For many airlines, this isn't hypothetical - it’s a reality. Despite selling tickets and providing services, millions of dollars in airline revenue remain trapped in countries for extended periods of time. In aviation, this problem is known as blocked funds, and it’s a serious threat to global connectivity and economic growth.

Blocked funds are revenues earned by international airlines in local currencies that cannot be repatriated in US dollars due to government-imposed restrictions or foreign exchange shortages. Why does this happen?

Airlines have a unique business structure. They earn revenue in many countries, but most of their major costs - aircraft, maintenance, and people - are centralised at their home base and are paid in US dollars.

To make this system work, when countries sign air services agreements, they also agree that airlines should be able to repatriate the funds earned from sales in those countries back to their base. That ensures airlines can pay their bills and keep operations running safely and reliably.

But countries do not always abide by what they have agreed. Sometimes they place restrictions on currency leaving their borders or limit access to foreign exchange. That puts airlines in a very difficult position: it’s hard to sustain operations if you can't use the revenues you've earned to pay the bills.

As of October 2025, airlines had a staggering $1.2 billion in blocked funds globally. Timely repatriation in US dollars is essential for airlines to meet dollar-denominated expenses like leasing, fuel, maintenance, and salaries.