Africa’s Aviation Growth Stalls Amid $1.2 Billion Blocked Funds and Policy Fragmentation

Stakeholders at the integrated Aviation Transformation forum in Nairobi on February 25, 2026

Africa’s aviation industry is struggling under the weight of fragmentation, high operating costs and an escalating $1.2 billion airline revenue crisis that industry leaders warn is suppressing growth across the continent.

Speaking at the Integrated Aviation Transformation Programme (IATP) forum in Nairobi on Wednesday, aviation stakeholders painted a picture of a sector with immense potential but constrained by policy inconsistencies, financing gaps and blocked airline funds, 90 percent of which are currently tied up in African markets.

Somas Appavou, Regional Director for External Affairs and Sustainability for Africa at the International Air Transport Association (IATA), said airlines are facing severe cash flow disruptions due to what are known as “blocked funds”, revenues earned in certain countries but not repatriated in hard currency.

“Currently, there is $1.2 billion blocked, and 90 percent is in Africa,” Appavou said.

He explained that airlines sell tickets in local currencies but are entitled under bilateral air service agreements and international treaties to repatriate earnings in hard currency, usually the US dollar. However, in some markets, central banks are unable to release the funds.

The consequences, he warned, are far-reaching.

“It penalises the airline because they have a lot of money blocked there,” he said. “They will put a connectivity risk premium on the sales of tickets, which makes tickets even more expensive.”

That added cost affects both airlines and passengers. Higher ticket prices suppress demand, limit route expansion and ultimately shrink market growth instead of expanding it.

“It takes sometimes a year, sometimes two years,” Appavou noted, adding that airlines still have to pay for fuel, navigation, landing fees and catering, all priced in dollars.

Beyond the blocked funds crisis, industry leaders say Africa’s aviation sector continues to grapple with fragmentation, which has left the continent with only about 3 percent of global aviation market share.

Frankline Omondi, Aviation and  Environment Expert at the African Civil Aviation Commission, described fragmentation as one of the biggest structural obstacles.

“This is why the contribution of African aviation to the global market share has remained at only 3 percent,” he said.

Different policy priorities across African states, he explained, have led to inconsistent regulatory frameworks that make cross-border operations costly and inefficient.

To address this, aviation stakeholders are pushing for harmonised policies, collaborative maintenance systems and stronger human resource development to reduce dependence on external markets.

“We are trying to focus on harmonisation policies so that aviation can operate as one entity, regardless of where in Africa,” Omondi said.

Meanwhile, in West Africa, efforts are underway to tackle another major contributor to high ticket prices, excessive taxes and charges.

Chris Appiah, Director for Transport at the regional body for West Africa, said member states have adopted a groundbreaking Supplementary Act directing governments to remove certain taxes and reduce charges on airline tickets.

“From our simulations, once we are successful with this, demand will go up by almost 50 percent — 48.9 percent,” Appiah said.

He noted that more affordable air transport would stimulate demand, increase travel and ultimately generate higher overall revenue for governments.

However, financing remains a persistent challenge. Many infrastructure upgrades, safety enhancements and integration projects require significant capital investment.

“Behind most of these very good policies and actions is the issue of financing,” Appiah acknowledged.

Stakeholders also highlighted the need to invest in sustainable aviation fuel production, cargo infrastructure and maintenance, repair and overhaul (MRO) facilities within Africa to reduce operational leakages to other regions.

Since the COVID-19 pandemic, cargo operations have emerged as a key revenue stabiliser for airlines, with some converting passenger aircraft into cargo carriers to survive the downturn.

Yet without coordinated regulatory frameworks and improved financial mechanisms, industry leaders warn that Africa risks missing out on the full economic potential of aviation as a driver of trade, tourism and continental integration.

For now, the message from aviation experts is clear: unless African states harmonise policies, unlock blocked airline revenues and make flying more affordable, the continent’s skies may remain open, but its aviation growth grounded.