The Senate has passed a resolution urging the Central Bank of Nigeria (CBN) to release $717,478,606 that is currently trapped in the country from various airlines. In addition to this, the Senate is requesting that $25 million be allocated to airlines’ operating in Nigeria at the CBN’s fortnightly dollar auction. These resolutions were passed during plenary after Senator Biodun Olujimi’s motion titled “Current Issues on airlines blocked funds in Nigeria” was considered. Senator Olujimi chairs the Senate Committee on Aviation, and the motion was presented by Vice Chairman of the Committee, Senator Bala Na’Allah on his behalf.
Senator Na’Allah has expressed his concerns over the increasing airlines’ blocked funds in Nigeria, making it the most challenging country for airlines to repatriate their funds. As of March, Nigeria accounts for $717,478,606 of the total airlines’ blocked funds in the world. The Senate is urging the Federal Government to take immediate action on the issue. It called on President Muhammadu Buhari to direct the CBN Governor, Godwin Emefiele, to release the airlines’ blocked funds to the affected airlines.
According to Senator Na’Allah, airlines’ blocked funds have been on the rise in Nigeria. In February alone, Nigeria accounted for 44% of the total airlines’ blocked funds in the world. Additionally, out of the total amount of blocked funds, $186.5 million were matured bids which CBN has not yet delivered and three stakeholders- IATA, Qatar Airways, and Ethiopian Airlines, accounted for 57% of the total blocked funds. The review of the last six months indicates an average monthly increase of $49.3 million in airlines’ blocked funds in Nigeria.
The Senate has warned that these blocked funds have consequences, as they result in limited and expensive ticket sales, which, in turn, affects customers and airlines alike. Cheap tickets are unavailable in Nigeria, as taxes and inflation have already affected the profit margin. Ultimately, customers will suffer as they may have to pay higher costs for tickets, whereas neighbouring countries can obtain cheaper tickets because they make prompt payments.
The Senate has urged airlines’ operating in the country not to withdraw their services while efforts are underway to resolve the issue. The Senate voted to approve the prayers when they were put to a voice vote by Senate President Ahmed Lawan.
