The Association of Foreign Airlines and Representatives in Nigeria has asked the Central Bank of Nigeria not to waste time releasing the promised $265 million from its members’ funds tied up in the country.
The association’s chairman, Kingsley Nwokeoma, said in a telephone interview with our correspondents on Saturday that it was commendable that the government promised to release some of the money, but that there should be no delay if the brewing crisis in the sector were to end. are being solved. turned away.
Emirates Airlines had threatened to suspend flights to Nigeria from September 1 over the $85 million locked-in, while some other foreign airlines gave the government until December, coupled with fears they would also suspend flights.
Also on Friday, British Airways stopped travel agents in Nigeria from selling their tickets amid the difficulty of foreign airlines to repatriate the $464 million ticket sales proceeds to their respective home countries. The International Air Transport Association stated on August 18, 2022, that withheld funds from foreign airlines in Nigeria increased from $450 million in May to $464 million in July.
The stuck $464 million has caused foreign airlines to increase their airfares, cut flights and suspend operations due to their inability to repatriate funds to their home countries.
To avert the looming crisis, the CBN announced the release of $265 million on Friday. A breakdown of the figure indicated that $230 million was released as a special FX intervention, while another $35 million was released through the Retail SMIS auction.
The director of Corporate Communications, CBN, Mr. Osita Nwanisobi, said in a statement Friday that the top bank, headed by Mr. Godwin Emefiele, was not against a company repatriating its money from Nigeria, but that the bank stood for orderliness.
“With Friday’s release, both operators and travelers are expected to breathe huge sighs of relief as some airlines had threatened to withdraw their services due to undistributed funds for outstanding ticket sales,” the statement said.
Speaking to the top bank’s move, Nwokeoma said: “Development is still ongoing and the airlines have not changed their stance until we see exactly what the government plans to do in this regard. We need to be very explicit about how much the CBN has released how much is still to be released and the timetable for the payments and repatriations We should have the numbers and statistics because there are a number of airlines involved.
“Even more important is the meeting convened by the House of Representatives. However, we don’t have to get that far for this intervention to take place because there is panic now. The airlines need this money. Those big airlines you see have long payment schedules with Boeing, Airbus and so on.
“If every country is like Nigeria, the airlines will not be able to pay off their debts and other obligations and you know that if you don’t pay off your debts or maintain your aircraft, that will endanger safety, and in this industry, safety is key. We hope to find out exactly what those numbers are for all airlines this coming week.
“Remember, Qatar cut frequencies before Emirates gave the September date, while the rest are asking the government to do something between now and December. That’s why the government is trying to look around to see what it can do. It doesn’t make business sense for the airlines if they can’t move their money to run their business.”
He called for a holistic assessment of the situation so that Nigeria would not be cast in a bad light, noting that the problem was recurring and funds had risen to hundreds of millions of dollars.
He added: “We know how much that is owed, so we need to know how much is being released to the different airlines. We need to have all those numbers and we also need to have a timeline for the funds to be released; will it be a continuous thing are and how are we going to avoid this problem that has been there over the years?These are the issues that need to be considered in order to sort this issue out.So it’s not just about freeing up money, it’s about having take a critical look at it and find a way around it.”
“It’s not just about releasing some funds; it’s about everyone sitting down collectively to get to the root of the problem because it’s a shame. That is very important for us, so that this situation does not repeat itself.”
Asked about the breakdown of what each airline owed in the more than $600 million, Nwokeoma said there were more than 20 foreign airlines operating in Nigeria, including the “big 10” and it would be difficult to estimate because there are still tickets continued to be sold and the fund would continue to grow.
He added: “The CBN has to release the money just like yesterday, because it would not have been the case if the CBN had acted. The airlines have written to the CBN a few times and the airlines have exerted pressure. Aviation is hardest hit by Covid-19 and how many people actually fly.
“The war between Russia and Ukraine has hit the world oil sector and you can even see that our local carriers are also affected. We really need to look at the real cause of this and make sure it doesn’t happen again, and we need to learn to stick to agreements.”
Meanwhile, on reports that Emirates was canceling its plan to suspend flights from September 1, a senior airline official asked one of our correspondents to speak with the airline’s PR agent. The officer also provided the agent’s contact.
The airline’s PR officer was contacted with the question whether the international airline would discontinue its plan to suspend flights to Nigeria by September according to the latest developments from CBN and she replied: “I don’t think so because I don’t have that information. ”
However, she promised to check with the carrier and return. She hadn’t done this at press time.