PANAMA CITY (Reuters) - International airlines are pinning their hopes on a change of government in Venezuela before some $4 billion owned to the firms by the state might be repaid, a top executive with the International Air Transport Association (IATA) said on Tuesday.
Venezuela has suffered a severe economic and political crisis over the past several years, including wide-spread shortages of basic goods and soaring inflation, which has also caused debts owed to the airlines to pile up.
Due in large part to strict currency controls in place since 2003, the government of President Nicolas Maduro has for years failed to reimburse the airlines in hard currency for ticket sales in local currency.
"Right now, recovering this money is a lost cause," said Peter Cerda, IATA's regional vice president for the Americas, on the sidelines of the Aviation Day industry forum held in Panama City.
"We hope that in the future, when there's a change of administration, it allows us to have a dialogue about recovering that money," he added.
Cerda added that IATA, which represents some 240 airline companies, has not had any talks with Maduro's government in two years.
As Venezuela's economy has continued to shrink, airlines like Delta Air Lines Inc (N:DAL), Deutsche Lufthansa AG (DE:LHAG) and LATAM Airlines Group SA (SN:LTM) have cut their service to the South American country. Other carriers like Air Canada (TO:AC) and American Airlines Group Inc (O:AAL) stopped their flights in and out of Venezuela citing security concerns.
"There isn't much chance the companies will return... The government still owes the industry and until this is fixed it's difficult to expect any improvements," said Cerda.
Venezuela's communications ministry did not respond to a request for comment.