CARACAS May 29 Venezuela is making strides
toward paying airlines billions of dollars in unrepatriated
revenue as it seeks to solve a currency-related dispute that has
led some carriers to cut flights to the country, a local airline
industry association said on Thursday.
Tame, AeroMexico, Aruba Airlines and
Insel Air agreed this week to receive a single payment of around
$200 million between them, at unknown discount rates, to cancel
debts from 2013, the Venezuelan Airlines Association said on
Other international airlines - including Iberia, Air Europa,
Air France, TAP and Delta - have either
received or will soon get offers from the government for the
funds they are owed.
The government requires airlines to sell tickets in the
local bolivar currency, but has been slow to allow repatriation
of funds under strict foreign currency controls.
ALAV President Humberto Figuera said he was cautiously
optimistic the debt issue was on track to be resolved, though
much hinged on how and when the payments pan out.
"This is an important week," said Figuera. "It's the start
of a solution to this grave problem which has had an enormous
impact on Venezuela's connectedness ... (But) there is no
certainty in this. If these payments are not made, we will end
up in the same situation."
According to ALAV, the money will be paid by 2016 primarily
at 6.3 bolivars per dollar, the rate at which carriers had hoped
to receive the funds.
Some 24 international airlines have an estimated $4.2
billion trapped in Venezuela, according to ALAV. Many have
reduced capacity while some have suspended flights altogether.
Air Canada recently cut flights to Venezuela
because of security concerns. Alitalia suspended
services due to delays in repatriating revenue.
Some other airlines have severely limited the number of
tickets available, sometimes only selling seats a few days in
advance of the flight.
Colombia's Avianca said this week Venezuela had
agreed to release it $12 million, equivalent to just 4 percent
of its unrepatriated revenue of $300 million.
Figuera said this was part of some $111 million released to
11 different carriers recently.
Starting in July, the government will allow airlines to
repatriate revenue at a rate of around 50 bolivars per dollar,
from roughly 11 bolivars currently.
While that is likely to translate into a price hike for
Venezuelans seeking to travel, Minister of Transport Hebert
Garcia Plaza said on Thursday that the new exchange rate will
make the repatriation process swifter.
President Nicolas Maduro last week denied that airlines were
cutting flights because of the country's economic problems. He
said they were simply rerouting aircraft to take advantage of
consumer demand for the upcoming World Cup soccer tournament in
(Editing by Alexandra Ulmer and G Crosse)