Pay Up $717.4m Trapped Airlines Fund, Senate Tells Emefiele

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News Investigators/ The Senate, on Wednesday, urged the Central Bank of Nigeria (CBN) to release the sum of $717, 478, 606 (usd) airlines funds trapped in the country, even as it called on the apex bank to allocate $25 million dollars to the airlines at its forth-nightly dollar auction.

The senate in a motion titled: “Current Issues on airlines blocked funds in Nigeria” sponsored by Sen. Biodun Olujimi (PDP-Ekiti) on Wednesday further resolved that the federal government should urgently reverse the trend of increasing airlines blocked fund.

Vice Chairman of the Committee, Sen. Bala Na’Allah (APC-Kebbi) who presented the motion on behalf of Olujimi at the plenary expressed concern on the plight of the airline operators and its effect on the aviation industry in Nigeria.

The upper chamber on President Muhammadu Buhari to direct the CBN Governor, Godwin Emefiele to pay up the blocked funds to the affected airlines.

The upper chamber further appealed to the airlines operating in the country not to withdraw their services while efforts were on-going to resolve the issue.

Speaking on the motion, Mr Na’Allah said that since Jan. 2021, Nigeria had been the most challenged country in the world for the airlines to repatriate their funds to support their operation.

In Feb. Nigeria alone accounted for 44 per cent of total airlines blocked funds in the entire world.

The total airlines blocked funds in Nigeria as at March amounted to $717,478,606, dollars comprising matured bids that the CBN was yet to deliver, bids yet to mature and cash balances in airlines’ accounts for repatriation.

The matured bids not delivered by CBN amounted to $186.5 million dollars accounting for 26 per cent of total blocked funds while three stakeholders (IATA, Qatar Airways, and Ethiopian Airlines) accounted for 57 per cent of total blocked funds.

A review of airlines’ blocked funds in Nigeria in the last six months shows an average month-on-month increase of $49.3million dollars.

The consequences of these blocked funds are: Cheap tickets are not available in Nigeria because taxes and inflation will have eroded the profit when the funds are kept for a very long time.

This makes tickets very expensive and limited because neighbouring countries get the cheap tickets because of prompt payments due to prompt repatriation of funds.

With additional reports from nan.

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