Aviation

Lebanon among biggest debtors to global airlines

June 4, 2024, 4:19 AM

An airplane on final approach to Beirut International Airport: Lebanon has cut the amount owed to airlines by 9%

Total drops to $129m, from $175m in 2021
Visitor numbers down 13.5% in Q1
Egypt makes progress on ‘blocked funds’

The money owed to international airlines in Lebanon has fallen by almost 9 percent year on year, but still totals $129 million, the International Air Transport Association reported on Sunday.

Lebanon takes the fifth spot in a 2024 list of countries where funds are overdue for repatriation, IATA said. It was the No 1 country for blocked funds in 2021, with $175.5 million held for 52 months.

Tourist trips to Lebanon have fallen since fighting began between Israel and Hezbollah on its border last October.

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Visitor numbers for the first three months of 2024 were 13.5 percent down on the same period last year, according to the Ministry of Tourism in Beirut. Industry insiders say there has been “no significant traffic” from Western markets, excluding that from the Lebanese diaspora.

In a report last month, Goldman Sachs said that although tourism was likely to remain suppressed for the rest of the year, the currency and other economic indicators in Lebanon are showing some signs of stabilisation.

The rate of inflation is falling and the economy is projected to grow by 0.2 percent in 2024, the first positive recording in five years.

On IATA’s blocked funds list for 2024, Pakistan accounts for the largest share with $411 million. It is followed by Bangladesh ($320 million), Algeria ($286 million), and Ethiopia ($149 million).

Worldwide, blocked funds have fallen by $708 million (28 percent) in 2024, after rising for three consecutive years.

IATA praised Nigeria and Egypt for clearing much of their overdue funds, with payments having been delayed by a currency crisis in the first case and dollar liquidity shortages in the second.

Nigeria reduced its blocked funds from a high in June 2023 of $850 million to $19 million at last count. IATA said Egypt had “also approved the clearance of its significant accumulation of blocked funds”, but did not give any figures.

Emirates airline announced last month that it would restart services to Nigeria from October 1, after a suspension of nearly two years.

Adnan Kazim, deputy president and chief commercial officer at the Dubai airline, said: “We thank the Nigerian government for their partnership and support in re-establishing this route.”

Emirates suspended flights to Nigeria from September 1, 2022, because of Nigeria’s failure to repatriate millions of dollars in revenue.