In a bid to address the current challenges faced by airlines operating in Nigeria, the Senate has called on the Central Bank of Nigeria (CBN) to release the sum of $717,478,606 in trapped airline funds. The upper chamber also urged the CBN to allocate $25 million to airlines through its dollar auction process. These resolutions were made following the consideration and adoption of a motion titled “Current Issues on Airlines Blocked Funds in Nigeria,” sponsored by Senator Biodun Olujimi, the Chairman of the Senate Committee on Aviation.
Senator Bala Na’Allah, the Vice Chairman of the Committee, presented the motion on behalf of Senator Olujimi. The Senate further appealed to the federal government to take immediate action to reverse the increasing trend of blocked funds faced by airlines in Nigeria. Additionally, President Muhammadu Buhari was called upon to direct the CBN Governor, Godwin Emefiele, to ensure the prompt payment of the blocked funds to the affected airlines. It was also emphasized that the airlines should not withdraw their services during the ongoing efforts to resolve the issue.
During the motion, Senator Na’Allah highlighted that Nigeria has been the most challenging country for airlines to repatriate their funds since January 2021. In February, Nigeria alone accounted for 44% of the total airlines’ blocked funds worldwide. As of March, the total amount of blocked funds in Nigeria stood at $717,478,606, including matured bids awaiting delivery by the CBN, bids yet to mature, and cash balances in airlines’ accounts for repatriation.
The consequences of these blocked funds are significant, as they result in limited availability of cheap tickets in Nigeria due to the erosion of profit caused by taxes and inflation. Prompt repatriation of funds in neighboring countries allows them to offer cheaper tickets, while Nigeria suffers from expensive and limited options. The Senate recognized the urgency of addressing this issue to support the growth and stability of the aviation industry in the country.
The motion received overwhelming support from senators, and the prayers were approved through a voice vote led by Senate President Ahmad Lawan. The Senate’s intervention and call for action by the CBN and the federal government aim to alleviate the financial burden faced by airlines and promote a conducive environment for their operations in Nigeria
