Venezuela’s government isn’t honoring its pledge to provide as much as $3.9 billion to airlines with bolivars trapped in the country, said the International Air Transport Association, known as IATA.
President Nicolas Maduro last month authorized the release of dollars owed to 24 airlines operating in the country, basing the total on the official exchange rate at the time of the ticket sales, Venezuelan Airlines Association President Humberto Figuera told reporters March 28.
“Since then there has been very little progress,” Tony Tyler, IATA’s General Director, said in a statement published on the organization’s website today. “The situation is unacceptable.”
Press officials at Venezuela’s Air Transport Ministry didn’t immediately return messages left by Bloomberg News.
At least 11 airlines have cut capacity on Venezuelan flights in the past year, some by as much as 78 percent, as the currency controls made it increasingly difficult to expatriate local earnings, according IATA. Air Canada stopped flying to Caracas in March.
The value of revenue trapped in bolivars is being whittled away by the highest inflation in the world and frequent devaluations of Venezuela’s currency.
Colombia’s Avianca Holdings SA (PFAVH) has about $300 million in cash in the country, or about 40 percent of its total cash holdings, according to company filings and conference calls. Panama City-based Copa Holdings SA (CPA:US) has $487 million in Venezuela.
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