The International Air Transport Association (IATA) has confirmed that the Central Bank of Nigeria (CBN) has successfully released $831 million of foreign airlines’ trapped funds from June of last year to date.
The Geneva-based IATA reported that this development has reduced the total amount of trapped international airlines’ funds globally to approximately $1.8 billion. From a peak of about $850 million in trapped funds in Nigeria last June, only $19 million remains outstanding.
According to IATA, the remaining $19 million is awaiting verification by the CBN through commercial banks. Willie Walsh, IATA’s Director-General, announced this in a statement on Sunday.
Walsh commended the Nigerian government for their efforts in facilitating the repatriation of the funds by international airlines. He stated, “At its peak in June 2023, Nigeria’s blocked funds amounted to $850 million, significantly affecting airline operations and finances in the country. Carriers faced difficulties in repatriating revenues in US dollars, and the high volume of blocked funds led some airlines to reduce their operations and one carrier to temporarily cease operations in Nigeria, which severely impacted the country’s aviation industry. However, as of April 2024, 98 per cent of these funds have been cleared. The remaining $19 million is due to the Central Bank’s ongoing verification of outstanding forward claims filed by the commercial banks.”
Walsh further added, “We commend the new Nigerian government and the Central Bank of Nigeria for their efforts to resolve this issue. Individual Nigerians and the economy will all benefit from reliable air connectivity for which access to revenues is critical. We are on the right path and urge the government to clear the residual $19 million and continue prioritizing aviation.”
Additionally, IATA announced a significant decrease in the amount of airline funds blocked from repatriation by governments globally, largely due to the clearance of funds in Nigeria. Egypt also approved the clearance of its significant accumulation of blocked funds. However, airlines were adversely affected by the devaluation of the Egyptian Pound and the Nigerian Naira.
The situation remains severe in Pakistan and Bangladesh, with $731 million in continuous blockage—Pakistan withholding $411 million and Bangladesh $320 million. IATA urged both countries to release these funds immediately to maintain essential air connectivity. The statement emphasized that in Bangladesh, the solution lies with the Central Bank prioritizing aviation’s access to foreign exchange, while in Pakistan, efficient alternatives to the system of audit and tax exemption certificates are needed to avoid long processing delays.
