CBN disburses $61m to foreign airlines to settle mature FX backlog

• Jan 8, 2024
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• admin
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The Central Bank of Nigeria (CBN) has disbursed $61.64 million to foreign airlines through various Deposit Money Banks (DMBs) to settle their mature foreign exchange (FX) obligations.

The CBN disclosed this in a circular dated January 7, 2024, signed by its Acting Director, Corporate Communications, Mrs Hakama Sidi-Ali in Abuja.

According to the circular, the disbursement was part of the CBN’s efforts to ensure liquidity and stability in the FX market, as well as to support the recovery of the aviation sector from the impact of the Covid-19 pandemic.

The circular stated that the disbursement was made to 17 foreign airlines operating in Nigeria, including British Airways, Emirates, Lufthansa, Air France, Turkish Airlines, Ethiopian Airlines, Qatar Airways, and KLM.

The circular also stated that the disbursement was based on the airlines’ FX requests submitted to the CBN through their respective DMBs, and that the CBN verified and validated the requests before approving the payments.

The circular further stated that the CBN would continue to monitor the FX market and intervene as necessary to ensure stability and transparency.

The CBN’s disbursement of $61m to foreign airlines is expected to ease the pressure on the airlines, who have been facing challenges in repatriating their earnings from Nigeria due to the scarcity of FX and the exchange rate volatility.

The CBN had earlier introduced the Non-Oil FX Rebate Scheme (NFRS) as part of the Race to $200 billion Non Oil Export earnings programme (RT200), to incentivize non-oil exporters, including foreign airlines, to repatriate and sell their export proceeds in the local FX market and earn a rebate.

The CBN had also directed the DMBs to create a platform for quarterly reconciliatory meetings with foreign airlines, to address the issue of blocked funds and ensure timely settlement of their FX obligations.