Senate to CBN: Release $717.4m trapped airlines funds
…makes case for $25m dollar auction for operating airlines
By Tunde Opalana
The Central Bank of Nigeria (CBN) has been asked to release trapped funds to the tune of $717, 478, 606 to airlines operating in the country.
The charge on the apex bank was made by the Senate on Wednesday during plenary.
The upper chamber also called on the Federal Government to urgently reverse the current trend of increasing airlines blocked funds in Nigeria.
It called on President Muhammadu Buhari to direct the CBN Governor, Godwin Emefiele to pay up the blocked funds to the affected airlines.
Also was the Central Bank was demanded to allocate $25 million to airlines operating in Nigeria at its forthrightly dollar auction.
These resolutions of the upper chamber were consequent upon the consideration of a motion titled: “Current Issues on airlines blocked funds in Nigeria” sponsored by the chairman of the Senate Committee on Aviation, Sen. Biodun Olujimi (PDP-Ekiti South ) during plenary.
But the motion was presented on her behalf by the Vice Chairman of the Committee, Sen. Bala Na’Allah (APC-Kebbi North).
Furtherance to this, the Senate appealed to the operating airlines in the country not to withdraw their services while efforts are on-going to resolve the issue.
Moving the motion, Na’Allah said that since Jan. 2021, Nigeria has been the most challenging 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, comprising matured bids that the CBN is 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 amounting 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.
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“The consequences of these blocked funds are: Cheap tickets are not available in Nigeria because taxes and inflation would 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.
