Nigeria, through the Central Bank have cleared $831m out of the $850m owed to International Airlines.
This was made known by the International Air Transport Association (IATA) on its website.
“At its peak in June 2023, Nigeria’s blocked funds amounted to $850 million, significantly affecting airline operations and finances in the country. Carriers faced difficulties in repatriating revenues in US dollars, and the high volume of blocked funds led some airlines to reduce their operations and one carrier to temporarily cease operations to Nigeria, which severely impacted the country’s aviation industry,” it read.
“However, as of April 2024, 98% of these funds have been cleared. The remaining $19 million is due to the Central Bank’s ongoing verification of outstanding forward claims filed by the commercial banks.
“We commend the new Nigerian government and the Central Bank of Nigeria for their efforts to resolve this issue. Individual Nigerians and the economy will all benefit from reliable air connectivity for which access to revenues is critical. We are on the right path and urge the government to clear the residual $19 million and continue prioritizing aviation.”
The is bound to provide some optimism as the country strives to find price stability in its FX market.
The International Air Transport Association (IATA) also reported a 28% decrease in the amount of airline funds blocked from repatriation by governments.
The union credited Nigeria as the main driver of the reduction with the significant clearance of blocked funds.
It revealed that the total blocked funds at the end of April stood at approximately $1.8 billion, a reduction of $708 million (28%) since December 2023.
“The reduction in blocked funds is a positive development. The remaining $1.8 billion, however, is significant and must be urgently addressed. The efficient repatriation of airline revenues is guaranteed in bilateral agreements. Even more importantly, it is a pre-requisite for airlines—who operate on thin margins—to be able to provide economically critical connectivity. No business can operate long-term without access to rightfully earned revenues.”
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