ASRTI faults FG for $464 million in funds trapped by foreign carriers

Ibekimi Oriamaja Reports

The Aviation Round Table Safety Initiative (ASRTI), a think tank and watchdog for the aviation sector, has expressed its outrage over the dreadful handling of accumulated foreign airline funds trapped in the Central Bank of Nigeria (CBN), calling it unacceptable that foreign currency has not been distributed to the affected carriers.

The International Air Transport Association (IATA) estimates that the hoarded cash reached $464 billion last month.

The ASRTI reprimanded the Nigerian government for breaking existing provisions in every bilateral air services agreement it signed with other nations, provisions that specifically call for Nigeria to make it easier for foreign carriers to transfer earnings to Nigeria.

The ASRTI’s spokesman, Mr. Olumide Ohunayo, said in a statement on Friday that the Federal Government was required to grant designated carriers the ability to convert and send to their country on demand any local earnings in excess of the amount locally disbursed.

Ohunayo asserts that the Nigerian government’s refusal to permit foreign carriers to return their trapped funds “is already acting as a deterrent to investors in the aviation sector.”

The declaration reads: “In all bilateral air services agreements, an article titled “transfer of profits” expressly says that each designated airline shall have the right to convert and send to its country on demand any local revenues in excess of amounts paid out locally. According to the current foreign exchange regulations, conversion and remittance are immediately permitted.

“Agreements that are sacred and upheld bind international trade. If Nigeria wants the interest of investors in our industry, we cannot act otherwise.

“It’s crucial to note that international airlines sold these tickets at the official IATA rate and cannot be expected to obtain, convert, and remit funds on the black market as suggested in some circles. Instead, the Central Bank should take the appropriate action in accordance with the BASA accords.

When the airlines receive clearance after paying all local requirements, including taxes, these monies should have been transferred at the official rate on the date of sale.