Foreign airlines' trapped funds in Nigeria now $783 million - IATA

The International Air Transport Association (IATA) has revealed that the value of trapped funds belonging to foreign airlines operating in Nigeria has reduced to $783 million as of August 2023.

This disclosure comes amid the association’s interaction with the Nigerian government on measures to resolve the situation which has caused some foreign airlines to halt operations in the country.

As of June 2023, the trapped funds stood at $812.2 million and Nigeria, together with Bangladesh ($214.1 million), Algeria ($196.3 million), Pakistan ($188.2 million), Lebanon ($141.2 million) and Ethiopia ($126 million) were the top five countries that accounted for 68% of blocked aviation funds.

According to the statement by the trade association, the IATA’s Regional Vice-President for Africa and Middle East, Kamil Al Awadhi had since initiated engagements with the Federal Government where it advised on providing long-term solutions to tackle the challenge of foreign exchange access to both domestic and foreign carriers.

The statement read in part, “Mr Al Awadhi also met with Nigeria’s new Minister of Aviation and Aerospace Development, the Honorable Minister Festus Keyamo, during which he called on the new government for continued, but closer, consultation with the industry while developing short- and long-term solutions for foreign exchange access to both domestic and foreign carriers. As of August 2023, Nigeria accounts for $783m of airlines’ blocked funds.”

Recall international airlines operating in the country have been faced with challenges of repatriating their revenue amid a protracted scarcity of forex.

The trapped funds have over the years, continued rising significantly thus leading to some airlines reducing their flight frequencies in the country.

Nigerian travelers have also suffered the brunt of the challenge as the affected airlines have gone ahead to block passengers from accessing lower inventory air tickets thus increasing the flight charges paid by passengers per route.