Group berates FG over trapped $464m foreign airlines’ funds

Aviation Round Table, a group of professionals and stakeholders in Nigeria’s aviation industry, is dismayed by the appalling handling of the accumulated foreign airline funds trapped in Nigerian banks, due to the non-allocation of forex.

Recall that, as of July 31, 2022, the total of trapped funds was, reportedly, $464 million, a figure that grew by $14 million from the $450 million earlier reported in May 2022.

The situation has triggered reactions from different quarters with some airlines already threatening to suspend flights from Nigeria.

In a statement signed by Olu Ohunayo, the spokesperson of ART, the group called on the Federal Government to consider all Bilateral Air Services Agreements with other countries as consecrated and desist from violating any such agreements so as to pave way for international trade to flourish.

The group reminded the government that in all Bilateral Air Services Agreements, an article in the agreement – transfer of earnings – clearly states that “each designated airline shall have the right to convert and remit to its country on demand, local revenues in excess of sums locally disbursed. Conversion and remittance shall be permitted without delay in accordance with the prevailing foreign exchange regulations.”

The ART added that international trade is bound by agreements which are consecrated and respected. Nigeria cannot do otherwise if we crave the attention of investors in our industry.

“It’s important to state that foreign airlines sold these tickets at the official IATA rate and cannot be expected to go to the parallel market to source, convert and remit as opined in some quarters, the central bank should do the needful as enshrined in the BASA agreements.

“These funds should have been remitted at the official rate on the date of sale immediately after the airlines get clearance of payment for all the local obligations including taxes.

“The damage our action has done to the Nigerian image as an investment-friendly nation is far-reaching. At the same time, the citizenry is faced with high fares, reduced capacity and limited travelling options, which will worsen if we continue on this trajectory.

“We found ourselves in this unenviable situation because we lack the capacity to compete, which would have reduced the remittance volume.

“The unborn Air Nigeria cannot produce this capacity, irrespective of the funds allocated, but by an aggregated process of developing our industry to produce vibrant flag carriers that will be courted for commercial partnerships which is the purveyor for successful international flight operations.

“We are also of the opinion that to kick start this process, a functional and credible data-gathering methodology for the industry is a necessity. We cannot continue to blow hot air without verifiable data,” the group said.