Stagnancy of Travel Business Foreign Exchange Policies Destroyed Travel Agencies
Karachi (PR): Mr. Irfan Iqbal Sheikh, President FPCCI, has apprised the federal government, State Bank, Civil Aviation Authority (CAA) and the aviation minister that the massive mismanagement in foreign exchange has blocked the remittance of proceeds of the airlines operating in Pakistan for the past 10 months; and, as a result, some of which have shut down their operations in Pakistan; others are in the process of limiting their operations and the rest are shifting their payment & transaction processing operations to their overseas offices.
FPCCI Chief was addressing a high-profile emergent meeting with the top leadership of the Travel Agents Association of Pakistan (TAAP) at the FPCCI Head Office; who informed him that travel agents are forced to shut down their operations due to the double whammy of bad government policies and high-handedness of the airlines.
Mr. Irfan Iqbal Sheikh explained that the government has blocked the transfer of revenues of the international airlines in Pakistan to their respective countries of origin or to their head office accounts overseas. As a result, all international airlines have tripled their fares for international travel from Pakistan – drying up most of the business trips from Pakistan necessary for securing export orders; sourcing raw materials for industrial production from various parts of the world; trade promotion & B2B activities; visits to overseas offices or business partners of the Pakistani businessmen; and, also limited the workforce traveling abroad to seek or explore work opportunities.
Mr. Irfan Iqbal Sheikh proposed to the federal government & SBP a two-pronged practical strategy to tackle the foreign exchange issue of the airlines: (i) clear the backlog in a structured manner through well-defined installments (ii) allow airlines to remit their revenues as normal from now onwards to prevent them shifting their payment collection offices from Pakistan.
Mr. Shabbir Mansha, VP FPCCI, demanded that the federal aviation minister, Khawaja Saad Rafique, should meet the stakeholders immediately to listen to their issues & possible remedies; and, help avert yet another important sector of the economy to collapse. He added that up to 100,000 workers will be rendered unemployed, if the travel agents cannot continue their business operations profitably.
Mr. Muhammad Raza, Vice Chairman of TAAP for South Zone, categorically highlighted that there has already been major job losses from travel agents businesses; as they are no more profitable, as well as due to non-payment of any commission to them by the airlines; which has previously been 7 – 9 percent and is a standard practice the world over.
TAAP delegation also stressed CAA to treat the domestic airlines at par with the international airlines; and, facilitate them meet their criteria for licensing, route allocation and regulatory requirements. The delegation was of the view that the country needs more airlines, airplanes, flights and travel routes to promote tourism & hospitality industry, national exports, cultural activities and better integrating Pakistan with the international economic activities.
Mr. Irfan Iqbal Sheikh said that FPCCI will encourage businessmen to form consortiums; and, launch new world-class, price-competitive and capacity-enhancing airlines indigenously. Pakistani business community need to be masters of their own destiny and they should stop looking at international airlines, he added.
Brig Iftikhar Opel, SI (M), Retd.