Fakoyejo OlalekanNigeria leads list of countries with blocked funds belonging to foreign airlines, the International Air Transport Association (IATA) has revealed.
On Wednesday, IATA disclosed in a list consisting of Nigeria, Pakistan, Bangladesh, Lebanon, Algeria and 22 others that about $2 billion revenue owned by foreign airlines is trapped globally.
According to a statement by the International Air Transport Association, airlines’ blocked funds in Nigeria is $551 million, Pakistan holds $225 million, Bangladesh $208 million, Lebanon $144 million, and Algeria has $140 million.
IATA however, said the collaboration between Nigerian House of Representatives, Central Bank, and the Minister of Aviation is an example of how trapped fund can be released.
Recall Emirates Airlines and some foreign operators had threatened to suspend operation in Nigeria due to their inability to repatriate their ticket revenue from the country.
One month ago, Emirates Airlines had stated, “Without the timely repatriation of the funds and a mechanism in place to ensure that future repatriation of Emirates’ funds do not accumulate in any way, the backlog will continue to grow, and we simply cannot meet our operational costs nor maintain the commercial viability of our operations in Nigeria.”
As of August, the total trapped funds in Nigeria was $464 million, before the central bank released $265 million to airlines to settle their outstanding ticket sales. Also, CBN governor, Godwin Emefiele, had also stated that at the end of October, $120 million will be released.
However, in the last three months, the blocked funds have risen by 18.7 per cent, representing $87 million growth between August and December when the IATA revealed that the trapped fund in Nigeria is now $551 million.
Foreign airlines are dependent on the Central Bank of Nigeria to obtain foreign exchange at a lower rate in the official market, as the forex available in the black market is sold at a premium rate by Bureau De Change operator.
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