IATA seeks immediate repatriation of $743m trapped airline funds in Nigeria
The International Air Transport Association (IATA) has called on Nigeria’s Ministry for Aviation to intervene in finding a solution to unrepatriated airline funds in Nigeria.
IATA made this call on Tuesday during a courtesy visit to the Aviation Minister, Hadi Sirika, in Abuja.
Earlier, IATA had disclosed that the unrepatriated amount of airline funds trapped in the country has risen to $743.7 million in January from $662 million it reported last December.
Speaking during the courtesy visit, Dr Samson Fatokun, Area Manager, West and Central Africa, who led the delegation, expressed gratitude to the Minister for his continued support for the growth of air transport in Nigeria and for the actualization of his role as catalyst for the growth of the Nigerian economy.
He, however, said the global airline community would like to appeal to the Minister for special intervention in resolving airline blocked funds issues in Nigeria, adding that the airlines were facing collateral damage while the average Nigerian was bearing the brunt of this issue.
“IATA and the global airline community will like to appeal for your special intervention for the resolution of airlines` blocked funds issue in Nigeria.
“As of January 2023, airlines `blocked funds in Nigeria have increased to $743, 721,097 from $662m in January 2023 and $549m in December 2022, “ said Fatokun.
According to Fatokun, the backlog of blocked funds in Nigeria puts the country in bad light about Foreign Direct Investment (FDI) in the country.
He explained that foreign airlines fly into Nigeria within the legal framework of the Bilateral Air Service Agreement (BASA), signed between their countries and the Federal Republic of Nigeria, adding that failure to repatriate trapped funds would mean the country is flouting its contractual obligations to foreign airlines.
“It is agreed in those BASAs that Nigeria will facilitate the repatriation of the funds of the other party’s airline. Nigeria flouts this contractual obligation by not facilitating enough the repatriation of airlines’ funds,” Fatokun said.
Fatokun added that, in dealing with the situation, the law of demand and supply was already taking its toll on the Nigerian market as some airlines have either reduced their frequency to the country or cut down the number of seats available to Nigerians.
As a result, the load factor for both passenger and cargo from Nigeria has been drastically reduced, a situation that poses threat to e-commerce and agro exports.
In reaction, Nigeria’s Minister for Aviation, Hadi Sirika expressed sympathy to foreign airline operators over their inability to repatriate revenues generated from ticket sales in Nigeria and re-emphasized the country’s commitment to Bilateral Air Service Agreements signed with other countries.
Sirika also assured that the aviation Ministry was concerned, and would do its very best to resolve the matter of blocked funds as soon as possible.
He stated further that the issue of blocked funds sits with the Central Bank of Nigeria and it is not what the ministry can handle alone.
According to Sirika, the issue would have been resolved immediately, if it was within the purview of the ministry.
He urged the International Airline Operators to be very considerate when dealing with the issue bearing in mind the effects of Covid 19 and recession the country had experienced.
