Foreign Airlines’ $450m Trapped Fund: Aviation Ministry To Intervene As IATA, Nigeria Meet

The Federal Ministry of Aviation, on Monday, expressed readiness to help foreign airlines operating in the country recover its $450m trapped revenue from the Central Bank of Nigeria (CBN).

Also, the International Air Transport Association (IATA), however, disclosed that it’s planning another round of discussions with Nigerian officials to secure the release of the trapped $450 million in revenue earned by international carriers.

IATA had over the weekend accused Nigeria, Algeria, Ethiopia, Eritrea and Zimbabwe of restricting access to the investors to repatriate their profits worth over $1 billion in despite several rounds of talks.

Algeria, Ethiopia and Zimbabwe, altogether are withholding $271 million from foreign airlines, in May marginally paid down what they owed. Eritrea was unchanged at $75 million, IATA said.

But, in an exclusive chat with LEADERSHIP, the spokesman to the minister of Aviation, James Oduadu, said the repatriation of trapped fund is not in the purview of the ministry but, Federal Ministry of Finance.

He, however, stated that the minister is ready to help the foreign airlines repartrait their funds to their country and also to make the airlines more profitable.

He said, “I know that the minister of Aviation, Sen. Hadi Sirika, is at the forefront of encouraging both local and foreign airlines to operate to be their full capacity and I know that he is one person that will do whatever is possible for airlines operating in Nigeria to have access to their funds.

“If it’s true that Nigeria is blocking fund which I doubt very much, probably, there may be issues that are not resolved and offcourse, repartraition of funds is not within the purview of the Ministry of Aviation, but that of finance ministry. If there are problems the foreign airlines are facing and they need assistance of ministry of aviation, the onus is on them to come for intervention even though it’s not within the purview of the ministry and I can assure all stakeholders, local and foreign that the minister of aviation is committed to doing whatever is humanly possible to ensure that their operation are effective, efficient and profitable,” he said.

Meanwhile, IATA said it is planning fresh round of discussions with Nigerian officials to secure the release of the trapped $450 million in revenue earned by international carriers that are operating in the country.

The fresh meeting between IATA and Nigerian officials which date will be announced later will be the third of such.

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The two parties had held two rounds of talks with Nigerian officials, including from the Central Bank of Nigeria, which Vice President for Africa and the Middle East, Kamal Al Awadhi, said was “not responsive” to releasing cash.

The $450 million allegedly held by Nigeria is said to be the largest amount being withheld by any African nation, and in May, the amount grew by 12.5 per cent higher than the figure of the previous month.

Al Awadhi described talks with Nigerian officials to release the funds as a “hectic ride”, stating that “We keep chipping away and hoping that it clicks that this is going to go to damage the country down the road,” he told reporters in Doha.

Al Awadhi, a former chief executive of Kuwait Airways, said that Nigerian officials had blamed the lack of access of the foreign airlines to their revenue on the foreign currency crisis in the country.

Nigeria is faced with severe foreign exchange scarcity, pushing the exchange rate of the dollar to as high as N615.

Al Awadhi said Nigeria had previously blocked revenue from foreign airlines but later repatriated the funds.

“Hopefully, we can get some sort of solution where it starts going down (but) it won’t, I doubt, the money will be paid in a single shot,” Al Awadhi said.