Nigeria appears to have returned USD29.2 million in foreign airlines' blocked funds in the past four months, according to the latest statistics released by the International Air Transport Association (IATA).
In a statement on September 19, the association said Nigeria presently accounts for USD783 million of blocked airline funds, while in another statement in June, it said Nigeria was withholding USD812.2 million in April 2023.
On inquiry, an IATA spokesperson confirmed that the reduction in trapped funds was "due to many factors, including a weak intervention from the [Nigerian] government". "Government intervention was not deep enough to significantly reverse the trend as the figures have started going up again. We forecast higher figures in September due to the accumulation of new sales, lack of liquidity on the Investors' & Exporters' FX Window and the inability of the Central Bank of Nigeria (CBN) to settle legacy matured FX (foreign exchange) bids."
The latest IATA statistics were released during a meeting between Nigeria's new Minister of Aviation and Aerospace Development, Festus Keyamo, and IATA's Regional Vice-President for Africa and the Middle East, Kamil Al Awadhi, in Abuja last week.
Al Awadhi called on the new Nigerian government for closer consultation with the aviation industry to develop short- and long-term solutions for foreign exchange access for domestic and foreign carriers.
IATA Director General Willie Walsh has warned that airlines cannot continue to provide services in markets where they cannot repatriate their revenues. A case in point has been Emirates (EK, Dubai International), which suspended services to Nigeria after the route became financially unviable, with the CBN holding on to the carrier's ticket sales. It has demanded the repatriation of at least 80% of its remaining frozen funds and a guaranteed mechanism to prevent future remittance delays.
Emirates first suspended flights to Nigeria on September 1 after demanding the payout of USD85 million of its revenue. It reinstated them 10 days later after the CBN released USD265 million to international airlines. By November 2022, the carrier suspended flights again, citing unsuccessful negotiations with the Nigerian authorities.
Relations between the nations have thawed following the appointment of the new Nigerian president, Bola Ahmed Tinubu, earlier this year. Following a meeting on September 11 between Tinubu and Emirati President Mohamed bin Zayed Al Nahyan, the Nigerians announced an agreement was reached that would see Emirates and Etihad Airways resume flights and immediately lifting a UAE visa ban on Nigerians. However, no official statement was issued by the UAE. An unidentified Emirati official told CNN there was no change in the travel ban. Nigeria then indicated the CBN would announce a roadmap in the next two weeks to address the refunds and that modalities were being discussed with the UAE government.
