Foreign airlines that operate in Nigeria have expressed disappointment over the $61 million paid by the federal government as first installment to offset the $800 million revenue of the international carriers trapped in Nigeria.
The airlines described the amount paid as insignificant, saying they may review their continued flight operation to Nigeria because the government did not take the payment of the blocked fund as priority.
This was disclosed by the President of the Association of Foreign Airlines and Representatives in Nigeria (AFARN), Dr. Kingsley Nwokoma, during a press conference held at the Murtala Muhammed International Airport, Lagos, on Thursday.
The association said the $61 million recently released by the Central Bank of Nigeria (CBN) was negligible and complained that the government did not make it clear whether it would be offsetting the trapped funds on planned payment schedule, which would enable the airlines to know when all the funds would be released to them.
Nwokoma, warned that if the crisis surrounding the debt was not resolved early, some of the airlines may follow Etihad and Emirates Airlines to withdraw service from Nigeria.
He regretted that the federal government violated the Bilateral Air Service Agreement (BASA) arrangements signed with the various countries the airlines emanated from, stressing that the action signified negativity on the image of Nigeria.
He attributed the blocked funds to one of the reasons airfares out of Nigeria were high, disclosing that the country was losing some of its potential travellers to neighbouring African countries, which have relatively lower fares.
Nwokoma, lamented that with the current situation, most of the foreign airlines operating into the country were taking money from their operations elsewhere to sustain operations in the country.
He said: “We are not saying the government should pay all, but the government should have a plan to pay a chunk of the money every quarter. The fear is that if it continues like this, some of the airlines may go.
“The last conversation we had with Mr. Festus Keyamo, the Minister of Aviation and Aerospace Development, seemed good. He sounded serious about the payment and they have done $61 million thus far.
“Nigeria is just a very strange country. Some are still saying that the airlines should not be asking for any money from Nigeria. What is BASA? BASA is signed by countries and not airlines. We signed our commitment to the BASA and we are not doing anything about it.
“If all countries are defaulting like Nigeria, there will not be any airline that comes into the country again. The aviation industry is predicated on the U.S dollars. You pay your catering, handling, hotel and a lot of things in dollars and if you don’t pay, your crew would be sent out.”
Nwokoma, insisted that the $61 million released by the government out of the $800 million was insignificant and without any impact on the operations of the foreign airlines.
He advised the federal government to discuss with the foreign airlines on the modalities of payment for the blocked funds.
“The foreign airlines are not talking about it because they felt it is a little drop. It is not something to be too excited about. If we have had about $300 million now or half of what the airlines are being owed, then, you can say there is hope.
“The government should sit with the foreign airlines just like how you sign your BASA agreements and agree on quarterly payment of these funds. The government should please keep to that agreement. By then, we will be making progress,” he said.
The CBN had last week disbursed $61.64 million to foreign airlines through various Deposit Money Banks (DMBs).
According to a statement issued by Mrs. Hakama Sidi-Ali, its Acting Director, Corporate Communications, in Abuja on Sunday, the disbursement was in fulfillment of CBN’s commitment to eliminate the backlog of pending matured foreign exchange in DMBs.
Sidi-Ali had said that the initiative was part of the CBN’s efforts to reduce its remaining liability to the airlines.