The Minister of Finance, Carla Loveira, assured on Monday, June 16, that a process is currently underway with banks to make the necessary foreign currency available for the repatriation of funds retained in the country by airlines, according to news agency Lusa.
“We are working with the banks to ensure the availability of the foreign exchange that is being requested,” said the minister, in response to journalists following the “16th Scientific Conference of the Bank of Mozambique” in Maputo.
On June 2, Lusa reported that airlines had, by the end of April, 75 billion meticais (USD 1.1 billion) in blocked funds awaiting repatriation in several countries. According to the International Air Transport Association (IATA), Mozambique topped the list, retaining 13.94 billion meticais (USD 205 million) of airline funds, up from 8.64 billion meticais (USD 127 million) in October 2024.
Also on Monday, June 16, the government advocated for a gradual and well-calibrated liberalization of the country’s capital account, which covers international transactions, to avoid negatively impacting national finances, particularly with regard to foreign exchange needs for imports and capital exports.
“It is our conviction that capital account liberalization must be gradual and carefully calibrated, considering the specificities of our economy, the robustness of the financial system, and the risks associated with capital flow volatility,” said Carla Loveira at the central bank event.
The capital account, which was the theme of the conference, refers to international transactions involving non-financial assets and capital transfers such as debt forgiveness or capital project subsidies. The minister recalled that Mozambique approved a revision of the Foreign Exchange Law in December 2022 to “improve the flexibility of the foreign exchange market through the gradual removal of capital account restrictions, thus contributing to the liberalization of capital flows between Mozambique and the rest of the world.”
According to IATA, globally, blocked airline funds that cannot be repatriated amounted to 88.4 billion meticais (USD 1.3 billion) as of the end of April, with the Africa and Middle East (AME) region accounting for 85% of that total—around 74.8 billion meticais (USD 1.1 billion).
“This is a significant amount, although it represents a 25% improvement compared to the USD 1.7 billion recorded in October 2024. IATA urges governments to promptly remove all barriers preventing airlines from repatriating their revenues from ticket sales and other activities, in line with international agreements and treaty obligations,” the organization stated.
IATA’s Director General, Willie Walsh, emphasized in the same report that “ensuring timely repatriation of revenues is vital” to enable airlines “to cover their dollar-denominated expenses and maintain operations.”
“Delays and denials violate bilateral agreements and increase currency risks. Reliable access to revenue is fundamental for any business—especially for airlines, which operate on very thin margins. Economies and jobs depend on international connectivity. Governments must understand that maintaining connectivity becomes a challenge when revenue repatriation is delayed or denied,” said Walsh.
On February 18, the Confederation of Economic Associations (CTA) of Mozambique warned that a lack of foreign currency in the market was forcing airlines to reduce their operations in the country, calling for urgent action.
Source: DE
