Foreign airlines laud new CBN monetary policy

 Some international airlines operating to Nigeria said they welcomed announcement of a full float of the Naira, which will make the foreign exchange rate to be now determined by market forces.

Central Bank of Nigeria (CBN), Godwin Emefiele averred that the 41 items banned last year from access to forex remained banned. Although the apex bank said it will intervene “as the need arises”.

According to him, “We’re talking about an open, transparent two-way system… It’s intended we don’t have speculators and rent-seekers. I don’t expect that any other exchange rate will be recognized.”

For the first time however, the CBN appointed primary dealers who are expected to help boost foreign exchange, FX, liquidity in the market and introduced a two way quote which basically means that the market will act like the stock market where buyers and sellers will state price and quantity they are willing to sell.

The CBN Governor also revealed that Nigeria will now be operating a single market, adding that the new price for the Naira will be known when the market opens officially on Monday.

 

Some of the operators who spoke to woleshadare.net that the new monetary policy would bring what many considered to be astronomical rise in air fares down and lead to restoration of categories or segments of fares foreign carriers withdrew as a result on uncertainty in foreign exchange policy of the Nigerian government.

They said, “the policy if well implemented would bring down and stabilise air fare prices. They noted that investors were holding on to their investment, adding that the country would see to high level investment by investors once Naira is done.

They equally stated that the action would lead to people taking to travel as they would be able to plan as they would know the exact and correct exchange rate.

The uncertainty in the foreign exchange policy of the government coupled with the inability of the foreign airlines to repatriate their $575 million trapped in the country led to them, clandestinely cancel over ten categories of air fares.

The carriers were said to offer one single category of fares which did not give passengers the option of cheap fares.

The airline chiefs said foreign airlines never increased fares explaining that what happened was the taken off of categories of fares, adding that what put out in the media was erroneous.

Before now, these airlines made fares to be flexible with intending passengers choosing different categories of fares that suit them.

For instance, two people travelling on the same economy class could have different fares depending on the condition attached to the ticket. The difference could be as high as 40 per cent depending on the time of booking and duration of stay.