The Nigerian Senate has called on the Central Bank of Nigeria, CBN, to release over $700 million owed foreign airlines. According to checks $717,478, 606 belonging to airlines are trapped in the country due to the scarcity of foreign currency affecting the country presently.
There have been several internventions by the National Assembly lately to stop the airlines from grounding their operations due to inavalabilty of forex.
The airlines have not forclosed the possibility of going on strike if the situation persists.
But on Wednesday, the Senate urged President Muhammadu Buhari to intervene in the matter by directing the CBN to make the blocked funds available to the airlines, noting that Nigeria is the highest debtor to airlines in the world.
The motion was passed by majority of the senators after a voice vote.
The lawmakers, also, pleaded with the operators not to withdraw their services as they are making efforts to resolve the issue.
These are contained in the motion raised by Senator Biodun Olujimi and discussed during the plenary yesterday.
According to Senator Ibn Bala Na’Allah, the Senate Committtee vice Chairman on Aviation, who led the debate, Nigeria is the most indebted country to airlines with 44 percent funds belonging to then blocked by the CBN.
He said the problem started in 2021 after the airlines started having difficulty accessing forex to support their operations.
Senator Na’Allah said “Further notes that in February 2023, Nigeria alone accounted for 44 per cent of total airlines blocked funds in the entire world.
“Worried that the total airlines blocked funds in Nigeria as at March 28th, 2023 amounted to $717,478,606, comprising matured bids that the Central Bank of Nigeria (CBN) is yet to deliver bids yet to mature and cash balances in airlines’ accounts for repatriation.’’
“Concerned that matured bids not delivered by CBN amounted to $186.5m, amounting for 26% of total blocked funds while three stakeholders (IATA, Qatar Airways, and Ethiopian Airlines) accounted for 57 per cent of total blocked funds;
“Regrets to discover that a review of airlines’ blocked funds in Nigeria in the last six months shows an average month-on-month increase of $49.3million
“Further regrets that the consequences of these blocked funds are: Cheap tickets are not available in Nigeria because taxes and inflation would have eroded the profit when the funds are kept for a very long time thereby making tickets very expensive and limited because neighbouring countries get the cheap tickets because of prompt payments due to prompt repatriation of funds;
“Loss of revenue to the Airlines and the Nation by extension, airline companies folding and relocating to other neighbouring countries thereby depleting our Nation’s workforce ultimately leading to unemployment rate; and stoppage of foreign direct investments in aviation and other related industries in Nigeria.”
