In recent developments, Nigeria’s central bank announced the clearance of the entire backlog of verified claims owed to foreign airlines, resolving a longstanding issue of blocked payments.Thank you for reading this post, don't forget to subscribe!
However, the International Air Transport Association (IATA) contends that despite progress, challenges persist, with approximately $700 million still remaining in Nigerian banks.
Dollar shortages since 2016 have hindered the repatriation of funds for foreign airlines operating in Nigeria, causing financial strain.
The central bank’s spokesperson, Hakama Sidi Ali, confirmed the clearance of verified claims, disclosing that an additional $64.4 million in foreign exchange had been released, totaling payments to $136.7 million.
While IATA welcomed the release of blocked funds, it emphasized that a substantial task lies ahead in fully addressing the issue. According to IATA, around $700 million remains blocked in Nigeria’s commercial banks.
The association highlighted the role of commercial banks in sourcing dollars from the central bank to facilitate the repatriation of airline funds, underscoring the broader challenge of foreign currency shortages in Nigeria.
Moreover, IATA pointed out that the devaluation of the Nigerian currency has exacerbated the trapped revenue issue.
With the naira losing over 40% of its value against the U.S. dollar this month and a third of its value last year, airlines face challenges associated with the lower exchange rate. IATA urged against unfairly penalizing airlines due to currency fluctuations and expressed its commitment to closely monitoring the situation while collaborating with the government to sustain Nigeria’s connectivity to international markets.