CBN report reveals foreign airlines withdrew ₦795bn from Nigeria in H1 2023

The Balance of Payment compilation report released by the Central Bank of Nigeria (CBN) showed foreign airlines withdrew $1.76 billion (₦795.48bn at the exchange rate of ₦451/$) in the first and second quarters of 2023.

The total credit to the Balance of Payment account from airline travel stood at $19.39m (₦8.75bn).

The debit part of the balance of payments report shows expenditures on tickets by passengers stood at (₦779.61bn), cargo ($10.22bn), and others (₦5.65bn).

The repatriated amount, however, fails to resolve the overwhelming crisis in the aviation sector as foreign airlines have criticised the FG’s failure to pay off the outstanding debt.

According to the International Air Transport Association, (IATA) Regional Vice President, Africa & Middle East, Kamil Alawadhi, Nigeria as of 2023, was recorded as having the highest number of airlines’ blocked funds at $792m, Egypt came in second place with ($348m); Algeria ($199m); AFI zone ($183m) and Ethiopia $128m.

The FG, in a bid to resolve the crisis in the sector recently released the sum of $61 million to foreign airlines as part payment for the over $800 million owed, an amount the airlines have described as grossly inadequate.

As of July 2022, the amount of trapped revenue belonging to foreign airlines in Nigeria was about $464 million. The airlines further revealed that as of November 2023, about 90% of the $783 million trapped funds have not been paid. This amount has increased to around $800 million as of January 2024.

Recall this incident had led to the suspension of operations by two of the world’s mega flight companies, Emirates and Etihad from Nigeria.

The withdrawal of flight services by both airlines has cost the country, at least, a 20% decline in international passenger traffic.