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$464m trapped funds: CBN releases $265m to foreign airlines

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After several appeals and interventions to the Federal Government to save the nation’s aviation industry from total collapse, the Central Bank of Nigeria (CBN) on Friday issued $265 million to foreign airlines operating in Nigeria to settle outstanding ticket sales.

The release of the funds followed concerns by the CBN Governor, Mr Godwin Emefiele, and his team about the trapped funds and the implications for the industry and the economy.

A statement by the Director, Corporate Communications, CBN, Mr Osita Nwanisobi, said $230 million was made available as special FX intervention, while another $35 million was released through a retail SMIS auction.

CBN noted 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 outstanding sale of tickets,” CBN said.

Persecondnews reports that in recent times crisis had hit the aviation sector as a result of the inability of foreign airlines operating in Nigeria to repatriate their funds.

As of July ending, the blocked funds belonging to over 20 foreign airlines had risen to over $464 million.

The situation got worse recently when international carrier, Emirates Airlines, wrote the Minister of Aviation, Sen. Hadi Sirika, indicating that it would  from September 1, 2022, suspend its operations in Nigeria, citing its inability to repatriate over $85 million trapped in the country.

The statement by Emirates airline said: “Emirates has tried every avenue to address our ongoing challenges in repatriating funds from Nigeria, and we have made considerable efforts to initiate dialogue with the relevant authorities for their urgent intervention to help find a viable solution.

“Regrettably, there has been no progress. Therefore, Emirates has taken the difficult decision to suspend all flights to and from Nigeria, effective September 1, 2022, to limit further losses and impact on our operational costs that continue to accumulate in the market.

“We sincerely regret the inconvenience caused to our customers. However, the circumstances are beyond our control at this stage.

“We will be working to help impacted customers make alternative travel arrangements wherever possible.”

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