April 29, 2014 / 10:14 AM / 4 years ago

CORRECTED-Venezuela failing to keep promises on airlines revenues -IATA

(Removes word ‘euros’ from lead. Amount is in dollars)

FRANKFURT, April 29 (Reuters) - Venezuela should urgently release $3.9 billion owed to airlines over ticket sales, the International Air Transport Association (IATA) said on Tuesday, saying the government was not keeping to promises to offer fair exchange rates.

The South American nation requires airlines to bill tickets in its bolivar currency and for close to two years the state currency board has denied airline requests to convert ticket sales revenues into hard currency and repatriate the funds.

The Venezuela government said at the end of March that it would allow foreign airlines to repatriate the money, using the exchange rate in place at the time the fares were sold.

“Since then there has been very little progress,” IATA Chief Executive Tony Tyler said in a statement. “The situation is unacceptable.”

IATA said that the Venezuelan government had made offers to release some of the airlines’ funds, but at lower exchange rates or at a discount, offers that were rejected by airlines.

“Airlines are committed to serving the Venezuelan market but they cannot sustain operations indefinitely if they can’t get paid,” Tyler said.

Airlines such as Germany’s Lufthansa have reduced services to the country, while Air Canada, has stopped services altogether, citing security concerns related to street protests.

IATA said the currency controls affected 24 airlines, 11 of which had reduced operations by between 15 and 78 percent over the last year.

Other airlines flying to the country include American Airlines, Delta, Avianca and Copa . (Reporting by Victoria Bryan; editing by Jason Neely)

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