Controversy as foreign airlines threaten to exit Nigeria

Key players have continued to react to the rumoured threats by some foreign airlines to pull out their services from Nigeria due to the lingering unpaid $800 million trapped funds in Nigeria.

As of December, the Regional Vice President of International Air Transport Association (IATA) for the Middle East and Africa Country, Mr Khalil Al-Awhadi had at the 2023 Global Media Day press conference in Switzerland put the accumulated trapped funds in Nigeria at $792 million which made Nigeria the highest indebted country to the foreign carriers globally.

Only last week, the federal government announced the payment of another $61 million out of the trapped funds to the airlines.

In a media conference held by the President of Association of Foreign Airlines Representatives in Nigeria (AFARN), Mr Kingsley Nwokoma, he likened the $61 million recently paid by the government as a drop in the ocean, calling on the federal government to urgently negotiate with the foreign carriers.

According to Nwokoma, negotiating an agreement with the foreign airlines will restore their confidence in the ease of doing business policy being propagated by the Nigerian government.

The foreign airlines representative who insisted that the latest $61 million debt paid cannot address the huge financial predicaments of the airlines, cautioned that some of the foreign airlines may leave Nigeria in protest of their trapped funds.

His words: “I will suggest the federal government should sit down with the foreign airlines to negotiate quarterly payment of the outstanding funds This will ease the payment burden on the government and also assure the airlines that the government is sincere in her promise that the airlines will get their full money from the Central Bank of Nigeria.”

The likely threats of the foreign carriers pulling out of the country out of frustration has however continued to generate mixed feelings amongst key players with some arguing that if such a situation arises that it may put extra pressure on air travel which hitherto had been at a crossroads due o high fares slammed on Nigerians by the foreign airlines as a way to survive the negative effects of the trapped funds.

Speaking to the Nigerian Tribune at the weekend, the President of the National Association of Nigerian TravelAgents (NANTA), Mrs Susan Akporiaye though said she did not see the foreign airlines pulling out of the country as it is being speculated, she however said should the airlines make do with their threats, that the situation will not bring good tidings to the travel professionals and Nigeria.

While declaring that the subsequent pullout of the foreign carriers from Nigeria “will further put pressure on travel, refuge competition with prices going up further”.

Akporiaye added: “Personally, I don’t see them going through with threats because this year some airlines have increased their flight frequencies from 4 times a week to 6 times a week. Some who are already flying everyday are requesting an additional slot to be flying twice a day, but in a worst-case scenario if any airline makes true threats that will not be good for us as travel professionals and Nigeria, it will further put pressure on travel, reduce competition and prices will go up further.

“The way out is for government to prioritise the situation and get the forex for the airlines to be able to repatriate their funds either all at once, installments. I will advise 50% at once & the balance in a structured payment plan that is workable and agreeable by both parties”.

For a former military commandant at the Murtala Muhammed Airport, Group Captain John Ojikutu, retired, the pullout of the foreign airlines will pose serious implications for Nigeria.

According to Ojikutu: “80% of our earnings in commercial aviation will be gone if the foreign airlines carry out their threats to withdraw their operations in Nigeria.

“Whoever knows the minister of aviation and aerospace development, Mr Festus Keyamo should tell him now. Whoever knows President Bola Ahmed Tinubu should go tell him now too to tell Keyamo to go find out what happened to the forex earnings ($2.5bn) that the Nigeria Aviation services providers collected from the foreign airlines annually? This is not a joking matter like the palliatives and the subsidies.

“Former President Olusegun Obasanjo told these characters to domicile these earnings in the CBN and be collecting the naira equivalent. What is the Accountant General and the Auditor General been looking at?”

While some stakeholders have described the threats from the foreign carriers to leave. Nigeria as a cheap blackmail, others have called on the government to take the development seriously, citing how Emirates Airlines, one of the airlines whose funds were trapped in Nigeria pulled out of the country over one year ago.

The IATA Vice President had in December lamented how many of the foreign carriers whose funds formed part of the trapped funds have been faced with operational challenges due to their inability to repatriate their proceeds out of Nigeria to their home countries.

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