Photo: CBN headquarters, Abuja.
The Central Bank of Nigeria (CBN’s) recent release of $265m to foreign airlines has saved the county the unprecedented embarrassment of grinding to a halt and stalling multiple economic activities.
Periscope International recalls that foreign airlines operating in the country had given September 1 as the ultimatum to freeze their services, if the federal did not yield to their demand for intervention.
The development would have been a dirge for the country battling its worst economic challenges in decades.
The airlines, over 32, had issued an ultimatum to withdraw their services in the country because of their withheld revenues, which they had failed to repatriate due to hitches from the CBN.
First to make this decision was Emirates, one of the most prominent, which announced that from September 1, there would be no flight operations to or from Nigeria.
Shortly thereafter, British Airways ordered its ticket offices to stop sale of tickets to Nigeria or from Nigeria.
However, in response, the apex bank on Friday stepped in to stop the impending danger by releasing $265 million to the airlines to settle outstanding ticket sales.
The airlines had said that they had millions trapped in Nigeria, Africa’s most populous nation due to an inability to access the foreign exchange to repatriate funds.
The total trapped money is estimated at about $600m.
After Emirates announced the date of suspending its service to Nigeria other carriers cut back their capacity to the country due to the difficulties in repatriating funds.
Nigeria, which gets 90% of its foreign exchange from oil, has struggled with a lack of foreign currency due in part to rampant pipeline theft, which has cut oil exports by nearly half a million barrels per day to around 1.4 million barrels per day (bpd).
The International Air Transport Association said that by July Nigeria had blocked airlines from repatriating some $464 million in revenue.
