Tame, an airline from Ecuador, suspended is once-daily flight to and from the country of Venezuela on Thursday until the government of the cash-strapped country pays the $43 million it is owed for its ticket sales.
The air carrier was the first airline to halt its flights into and out of Venezuela, whose left wing government now owes a group of carriers more than $3.3 billion, according to the airline association of Venezuela.
The airlines have become victims of the rigid currency policy controls Venezuela has installed, which prevent the airlines from repatriating their proceeds from sales of tickets in the South American oil-rich country.
Adding to the airlines’ difficulties, the Venezuelan bolivar has plummeted in value to one tenth of its official value in the country’s black market, which makes tickets, purchased inside Venezuela some of the least expensive around the world as far as in dollar terms.
Recently airline representatives have had meetings with government officials to discuss the proposal of the government to pay off the monies owed to the airlines with bonds, cash and fuel.
However, the talks have yet to produce an agreement and Tame along with several other airlines started to lose patience.
Globovision, a TV station in Venezuela reported Thursday that Air Canada stopped the sale of tickets in Venezuela. There was no answer at the offices of the Canadian airline in Caracas when a call was made to confirm the rumor.
However, an operator at a call center said she was given instructions to suspend all reservations and future sales. The media office for the airline in Canada did not answer an email requesting a comment.
Fernando Guerrero the General Manager for Tame told the media in Quito on Wednesday that Venezuela had not made any payments to the airline since sometime in March of last year, which was the month Hugo Chavez, the longtime president of Venezuela died.
Guerrero said the cost per month for Tame is $5 million to keep the Caracas to Quito route in operating. Venezuela owes even larger airlines such as Avianca from Colombia tens of millions of dollars.
On Thursday, Avianca’s stock plummeted over 4% after the government of Venezuela announced that people in Venezuela traveling aboard could no longer buy tickets at the rate of 6.3 bolivars per U.S. dollar.