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IATA okays release of $265m, urges foreign airlines to stay

By Wole Oyebade
30 August 2022   |   4:04 am
International Air Transport Association (IATA), yesterday, applauded Nigeria’s decision to release $265 million of foreign airlines’ funds stranded in the country, urging the operators to keep serving the market.

PHOTO: EMIRATES

• Emirates reverts withdrawal notice
International Air Transport Association (IATA), yesterday, applauded Nigeria’s decision to release $265 million of foreign airlines’ funds stranded in the country, urging the operators to keep serving the market.

IATA, which is the umbrella body for over 290 global airlines, also urged Nigeria to workout the release of the $200 million balance, and put in place measures to avert accumulations.

In a related development, Emirates Airlines has introduced four-weekly flights on Lagos routes, effective September 11.

Foreign airlines and travel operators, at the weekend, heaved a sigh of relief following the Central Bank of Nigeria’s (CBN) release of $265 million out of foreign carriers’ $465 million stranded in Nigeria.

The sector has lately been apprehensive over the stranded funds. Emirates airline, among others, had notified the government and customers of its plans to halt Nigerian operations, effective September 1, 2022.

IATA’s Regional Vice President Africa & Middle East, Kamil Alawadhi, yesterday, said they welcome the Nigerian Government’s partial release of blocked funds.

Alawadhi said they would continue to engage with Nigeria on expediting the release of the remaining amount, so that airlines could continue providing the connectivity Nigeria requires, without disrupting and harming its economy and jobs.

“We encourage other countries, in Africa and elsewhere, that are blocking the repatriation of foreign airlines’ funds, to follow Nigeria’s example and release the money they are withholding.

“Without it, airlines cannot afford to serve those countries. This would be detrimental to the people and businesses that depend on the market connectivity those airlines provide.

“IATA speaks and leads the industry on matters of common interest. While IATA cannot speak for individual airlines, we hope the release of blocked funds with assurances and safeguards to prevent a recurrence, will persuade affected carriers to continue serving Nigeria,” he said.

Even after this welcome and sizable release, there will still be more than $200 million of airlines’ funds blocked in Nigeria.

As previously reported by IATA, the following other African countries continue to block airlines’ funds: Zimbabwe $100m, Algeria $96m, Eritrea $79m, and Ethiopia $75m.

Emirates in a notice to its trade partners, entitled: “Emirates reinstates flight to Nigeria”, stated that operations to Nigeria will be reinstated with a four-weekly Lagos flights EFF on September 11, 2022, contrary to its usual 14-weekly flights.

The carrier added that Lagos flights beyond September 30, 2022, would be advised in due course.

Secretary General of the Aviation Safety Round Table Initiative (ASRTI), Group Capt. John Ojikutu (rtd), reckoned that the Federal Government did the needful to save face from international condemnation.

To avert a recurrence, Ojikutu said the Nigerian aviation must be intentional in repositioning local carriers to benefit from the international segment.

He said it begins with removing the multiple destinations given to the foreign airlines and to limit them to either Lagos or Abuja airports, and one other airport in the alternative geographical area to their choice in Abuja or Lagos.

“Let them (foreign carriers) make as many frequencies as they wish to the given destinations, but they must make interlining arrangements with the domestic airlines to help distribute incoming international passengers to their final destination and connect outbound international passengers to the nearest international airport, but payments must be done for the interlining connection in dollars.

“This way, you remove the foreign airlines out of our domestic routes and domestic markets of the domestic airlines. Finally, ensure that a Domiciliary Aviation Commercial Account is opened with the CBN where money generated by the operators in Aviation and Maritime are kept and naira equivalent given to the depositors. These dollars can be taken back when needed and the naira returned.

“That Domiciliary Account can be a succour for the repatriation of the foreign airlines money. There is also a BASA Account with the CBN where the repatriation money can substantially be taken. There was substantial money too once generated by Commercial Agreements, whatever was the reasons for the cancellation of those agreements can only be explained by those in the management of the civil aviation administration in and out of government,” Ojikutu said.

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