Despite CBN $61m disbursement, foreign airlines threaten withdrawal of services
Foreign airlines operating in Nigeria have expressed dissatisfaction with the initial $61 million payment made by the federal government to address the $800 million in revenue owed to international carriers stuck in the country.
The airlines described the amount as a little drop, stating that they might reconsider their ongoing flight operations in Nigeria due to the perceived lack of prioritisation by the government in resolving the issue of blocked funds.
The President of the Association of Foreign Airlines and Representatives in Nigeria (AFARN), Dr. Kingsley Nwokoma, conveyed these sentiments during a press conference at the Murtala Muhammed International Airport, Lagos.
AFARN emphasised that the $61 million recently released by the Central Bank of Nigeria (CBN) was insufficient. The association also raised concerns about the government’s failure to clarify whether there would be a structured payment plan to settle the trapped funds, providing the airlines with a timeline for the full release of their funds.
Nwokoma warned that unless the debt crisis was promptly resolved, some airlines might follow the lead of Etihad and Emirates Airlines in withdrawing their services from Nigeria.
He stated, “The foreign airlines are not talking about it because they felt it is a little drop. It is not something to be too excited about. If we have had about $300 million or half of what the airlines are being owed, then, you can say there is hope.
“The government should sit with the foreign airlines just like how you sign your BASA agreements and agree on quarterly payment of these funds. The government should please keep to that agreement. By then, we will be making progress.”
…Foreign airlines may be forced to leave Nigeria
He linked the high airfares departing from Nigeria to the blocked funds, revealing that the nation was losing potential travelers to neighboring African countries with comparatively lower fares.
Nwokoma expressed regret that under the current circumstances, many foreign airlines operating in the country were diverting funds from their operations in other regions to sustain their activities in Nigeria.
He stated, “We are not saying the government should pay all, but the government should have a plan to pay a chunk of the money every quarter. The fear is that if it continues like this, some of the airlines may go.”
Recall that last week the CBN announced the disbursement of $61 million to foreign airlines as part of commitments towards clearing the backlog of trapped FX owed to international airline operators in Nigeria.
Recall that the total amount of trapped funds belonging to foreign airlines in Nigeria reached around $812 million, one of the world’s highest. However, the CBN has stated it meets this obligation with time.
