CBN bows to pressure, releases $265 million out of $464 million airlines trapped funds

The Central Bank of Nigeria (CBN) may have bowed to both internal and external pressure as the country’s apex Bank released the sum of $265 million out of the total $464 million trapped funds to the carriers.

Just this week, the Minister of Information, Alhaji Lai Mohammed told reporters at the Murtala Muhammed Airport, Lagos that the Federal Government was working on resolving the impasse arising from keeping the airlines’ funds in the country.

The trapped revenue is said to be a result of a forex shortage, a sign that Nigeria is facing serious financial challenges.

A breakdown of the figure indicates that the sum of $230  million was released as a special FX intervention while another sum of $35 million was released through the Retail SMIS auction.

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Confirming the release, the Director, Corporate Communications Department at the CBN, Mr. Osita Nwanisobi said the Governor, Godwin Emefiele, and his team were concerned about the development and what it portends for the sector and travelers as well as the country in the comity of nations.

Nwanisobi reiterated that the Bank was not against any company repatriating its funds from the country, adding that what the Bank stood for was an orderly exit for those that might be interested in doing so.

With Friday’s release, it is expected that operators and travelers as well will heave huge sighs of relief, as some airlines had threatened to withdraw their services in the face of unremitted funds for the outstanding sale of tickets.

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The House of Representatives last week summoned the Central Bank of Nigeria (CBN) Governor, Mr. Godwin Emefiele, and the Ministers of Finance and Aviation, Zainab Ahmed and Hadi Sirika, respectively, to a stakeholders meeting.

The summon was hinged on resolving the face-off between the federal government and some international airline operators.

In the face of the crisis, Emirates announced the stoppage of flights to Nigeria on September 1, 2022.

The $85 million Emirates fund is part of the over $450 million airlines’ funds still withheld by the country.

Emirates aircraft in flight

Other countries in Africa that hold on to the huge amounts of airlines’ revenues include Zimbabwe – $100 million; Algeria – $96 million; Eritrea – $79 million and Ethiopia, $75 million (As of June 2022)

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There are indications that other international airlines whose funds are equally stuck are monitoring the situation that could see them cut down drastically on their flight services or completely suspend flight services to Nigeria to discourage the loss of more money.

Wole Shadare