IATA has warned that Argentina is starting to look like Venezuela when it comes to airlines facing difficulties in repatriating their revenue.
The association's chief Tony Tyler notes that the country recently raised limits on the amounts that companies can repatriate from the South American country. "More than half of the airlines in Argentina have accumulated revenue there," he says at a press briefing at the ALTA Leaders Forum.
Tyler was not able to specify how much airline revenue is being held up in Argentina, but notes that the severity of the problem is nowhere close to the situation in Venezuela, where IATA estimates that $3.8 billion in revenue is being held.
IATA looks forward to working with Argentina's new leadership after the country's general elections later this month, says Tyler. "We will engage with the government," he says.
It is not the first time over the past year that airlines have expressed concern over operations in Argentina. Some carriers had earlier cited weakness in the market, especially as the Argentinean peso depreciates against the US dollar.
Like Venezuela, Argentina's government also imposes strict controls on currency exchanges, which has led to currency being exchanged on the black market.
Airlines have made little headway in repatriating revenue from Venezuela, and some have resorted to cutting capacity. Brazil's Gol said recently it is considering withdrawing from Caracas. IATA's Tyler notes that foreign airlines in Venezuela are now forced to pay for fuel in US dollars, as the Venezuelan bolivar continues to collapse in value.
Source: Cirium Dashboard
