After being forced to suspend a number of its flights on September 30 after Peru's customs tax authorities seized its bank accounts, Peruvian Airlines (Lima International) has now suspended all flights and closed its offices until further notice. In a statement posted on its website on October 4, the state-owned carrier announced the cancellation of all flights from Lima International due to a “lack of liquidity”.

The “coercive action” of the “embargo carried out by the Customs of Peru on all of Peruvian's accounts” had resulted in “a lack of liquidity” that affected operations, the statement said.

The action created a half-day of paralysis in the carrier's operations, sowing distrust with travel agencies whose sales volumes plummeted, affecting the company's cash flows even more, “a situation from which we could not recover. So we are in the unfortunate situation of having to suspend all our flights until further notice,” the statement continued.

It added that the airline was pursuing efforts with new investors to “refloat the company”.

The cancellation of all Peruvian Airlines flights has caused chaos at airports across Peru since October 4. The provision of food, accommodation for the hundreds of passengers affected, as well as tents and first aid, has been managed by the National Institute for the Defence of Free Competition and Intellectual Property (Indecopi) with the coordination of government agencies and the ministries of transportation and tourism, the newspaper La República reported.

Vulnerable passengers such as older people, pregnant women, people with disabilities, and medical patients have been transferred to their destinations by Fuerza Aérea del Perú (Peruvian Air Force) aircraft.

Peruvian Airlines operated 13 routes using a fleet of four B737-300s, two B737-300(QC)s, one B737-400, and five B737-500s, according to ch-aviation fleets.