CBN Takes Action to Settle Foreign Airlines’ Outstanding Debts

The Central Bank of Nigeria (CBN) has disbursed a significant sum of $61.64 million to foreign airlines operating in the country.

This move comes as part of the bank’s efforts to address the long-standing issue of trapped funds, which has been a major concern for foreign airlines in Nigeria.

The CBN’s decision to release the funds is aimed at reducing the backlog of matured foreign exchange in various Deposit Money Banks (DMBs).

The bank’s Acting Director of Corporate Communications, Mrs. Hakama Sidi-Ali, stated that this initiative is a testament to the bank’s commitment to eliminating the backlog of pending matured foreign exchange in DMBs.

According to the News Agency of Nigeria, the total trapped fund of foreign airlines in the country is pegged at $800 million.

The International Air Transport Association (IATA) had previously threatened that some foreign airlines may be forced to quit the Nigerian market if nothing is done to address the issue of trapped funds.

In the past three months, the CBN has also redeemed outstanding forward liabilities of close to $2 billion. This underscores the bank’s commitment to resolving pending obligations and ensuring a functional foreign exchange market.

The disbursement of these funds is expected to provide a considerable boost to the Naira against other major world currencies and increase investor confidence in the Nigerian economy.

This is a positive development for the aviation industry and the Nigerian economy as a whole, as it will help to strengthen the country’s relationship with foreign airlines and promote a more stable and prosperous business environment.