Ethiopian Airlines Group is facing complex challenges in repatriating its overseas ticket sales revenue, with USD 45 million in funds currently blocked in Russia due to financial sanctions imposed by European nations following the war in Ukraine.
The money trapped in Moscow accounts for half of the carrier’s total USD 90 million in unrepatriated funds across its global destinations.
Following the outbreak of the war in Ukraine in February 2022, European nations disconnected major Russian financial institutions from the SWIFT international banking network and restricted cross-border financial transactions.
RELATED POSTS
“Due to sanctions, we cannot transfer funds through standard bank-to-bank transfer systems,” Lemma Yadecha, Chief Commercial Officer of Ethiopian Airlines, told The Reporter Magazine.
“In the past, we could easily transfer earnings from our Moscow account directly to our primary correspondent banks in the United States, United Kingdom, United Arab Emirates, Germany, or back home to Addis Ababa,” Lemma said. “Now, major international banking partners of Ethiopian Airlines—including Citibank, where we hold primary accounts—are prohibited under sanction rules from accepting funds originating from Russian banks or sending money into Russia.”
While the airline continues its daily operations in Russia—using a portion of its local ruble earnings to cover operational costs such as fuel, crew salaries, ground handling, and airspace overflight fees—the net profit cannot be remitted.
“To resolve the stagnant USD 45 million blocked in Russia, we are working with the Ministry of Foreign Affairs of Ethiopia and diplomatic missions,” Lemma stressed.
Leonid Berezhnyuk, the Press Secretary at the Russian Embassy, replied to an inquiry from The Reporter magazine, saying, “The Embassy’s position is that we do not comment on the activities of state-owned Ethiopian Airlines.”
Lemma noted that outside Russia, the airline’s financial situation regarding trapped funds remains under control.
“Except for the stagnant funds in Russia, all other blocked funds abroad have been declining, and we are in good financial shape overall,” he said.
To mitigate the issue in Russia, potential solutions under evaluation include utilizing the rubles held in Moscow to purchase Russian goods for the Ethiopian government, with the government subsequently reimbursing the airline locally in Ethiopian Birr. However, execution has been slow due to strict compliance requirements.
“Our corporate policy strictly mandates operating through formal banking systems,” Lemma noted. “Because of those guidelines, progress takes time, but we are currently reviewing two to three workable alternatives.”
Addressing concerns over the airline’s total USD 90 million in pending international revenues, Lemma emphasized a clear distinction between frozen capital and normal operational cash flow.
In African markets such as Mozambique and Angola, foreign exchange allocations from central banks are often slow, meaning funds roll over dynamically rather than remaining idle indefinitely.
“Except for Russia—where money is genuinely frozen due to sanctions—the rest of our global funds are active and moving continuously,” Lemma clarified. “The problem in those countries is that central banks cannot supply foreign currency fast enough to meet our demand.”
“We generate ticket sales revenue daily, submit clearance documents monthly, and collect transfers as local central banks allocate foreign currency,” he added.
However, holding revenue in soft currencies carries ongoing risks. “The primary risk associated with holding revenue in soft-currency markets remains local currency devaluation,” Lemma stressed. “If a country devalues its currency while funds are awaiting central bank clearance, the airline absorbs the exchange losses.”
According to data from the International Air Transport Association (IATA), USD 1.2 billion in airline revenues were blocked from repatriation by governments worldwide as of late October 2025. While this reflects a modest USD 100 million improvement since April 2025, roughly 93 percent of all blocked airline funds remain trapped in Africa and the Middle East.
