The International Air Transport Association (IATA) has disclosed that the amount of trapped funds belonging to foreign airlines operating in Nigeria currently stands at $734,721,097, compared to the $662 million it was in January 2023.
This was contained in a letter written to the Minister of Aviation, Hadi Sirika, and signed by the Area Manager West and Central Africa, Dr. Samson Fatokun.
In the letter, IATA said “For over a year, Nigeria has been the country with the highest amount of airline-blocked funds in the world. The amount owed has risen from $464 million in July last year.”
Foreign airlines have cut the number of seats available for sale in Nigeria and the frequency of flights in a bid to slow the rising debt burden, IATA said.
The central bank in Africa’s biggest economy rations dollars to preserve its foreign exchange reserves, which have come under pressure from slumping oil production. Foreign airlines sell tickets in local currency but are unable to get the dollar equivalent through the central bank.
Fatokun who led the delegation expressed gratitude to the Minister for his continuous support for the growth of air transport in Nigeria and for the actualization of his role as a catalyst for the growth of the Nigerian economy.
He said the global airline community would like to appeal to the Minister for special intervention in resolving of airline blocked funds issues in Nigeria, adding that the airlines are facing collateral damage and average Nigeria is bearing the brunt of this issue.
In a statement signed by the Deputy Director, Press and Public Affairs, Ministry of Aviation, Odutayo Oluseyi, the Minister assured IATA and foreign airline operators that the aviation Ministry was concerned and would do its best to resolve the matter of blocked funds as soon as possible.
He stated that the issue of blocked funds sits with the Central Bank of Nigeria and is not what the Ministry could handle alone; “otherwise, it would have been resolved immediately.”
He urged international airline operators to be very considerate when dealing with the issue bearing in mind the effects of Covid-19 and the recession the country had experienced.