Mixed feelings among airline operators over new forex policy

As the new foreign exchange (forex) policy takes effect today, airline operators in the country have greeted the new regime with mixed feelings.

While foreign airliners applauded the policy, several of their local counterparts have bemoaned the attendant exchange hike as unhealthy to the growth of the already-shrinking air travel business in Nigeria.

It would be recalled the Central Bank of Nigeria (CBN), last Wednesday, announced a flexible forex policy where the exchange rate of naira to dollar would now be determined by market forces.

The apex bank is also to appoint primary dealers who are to boost foreign exchange liquidity in the market and sell at rates ranging from N300 to N370 per dollar.

Foreign airlines that have in the last one year groaned over difficulties in repatriating stuck funds, commended the development, which would make the scarce forex available now.

Feelers from the airliners show that with the open blanket to repatriate about $600 million, the operators would reduce fare tickets and attract more patronage from the citizenry.

On the flip side, however, local operators have complained on the “unhealthy development” which the new regime would impose on the sector that is entirely dependent on foreign exchange.

Former Managing Director of Nigerian Airspace Management Agency (NAMA), Captain Roland Iyayi, said the hike would not mean well for any operators.

According to Iyayi, it is a double-edge sword, which though would make forex available, but might attract hike in ticket fares to the detriment of the industry.

Iyayi, who is the chief executive officer of Topbrass Aviation Company, added that the foreign airlines too would be affected since they would have to repatriate funds at the rates applicable, which means, taking out lesser funds than they should have.

To the President, Aviation Round Table (ART), Gbenga Olowo, money supply and demand mechanism was the ideal method to exchange rate fixation, provided the intrinsic element of corruption on government supply side is adequately prevented.

“The foreign airlines though will have some relief in the immediate future, it is not without a loss on the accumulated funds of the past which will be repatriated at a rate higher than that of their ticket sales.’’