Airlines differ as CBN claims forex backlog cleared with $64m

The Central Bank of Nigeria (CBN) has announced that it has concluded the payment of all verified claims by airlines with an additional payment of $64.44 million to the concerned airlines.

Confirming the figures on Tuesday in a statement, the acting Director of Corporate Communications at the CBN, Mrs Hakama Sidi Ali, noted that the latest amount paid to the airlines brought the total verified amount paid to the aviation sector to $136.73m.

She said, “The Governor, Olayemi Cardoso, and his team are doubly committed and would stop at nothing to ensure that the verified backlog of payments across all other sectors was cleared and confidence was restored in the Nigerian foreign exchange market.

“The CBN is working with stakeholders to ensure liquidity improves within the forex market, thereby reducing pressure on the naira.”

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While expressing optimism that the market would respond positively with the latest injection of over $64m, she urged actors in the foreign exchange market to guard against speculations as such actions could hurt the naira.

The Apex bank also has asked all authorised dealers in the foreign exchange market to desist from reporting inaccurate and misleading information on transactions concluded in the financial market.

In a circular to all the market dealers, the central bank said ongoing investigations have revealed instances of underreporting of transaction rates and the practice of ‘second cheques’ on foreign exchange and fixed-income transactions.

The CBN had permitted financial markets transactions to be conducted on a ‘willing buyer willing seller’ basis, by which prices are expected to be quoted and displayed transparently.

According to the apex bank’s circular, many of the players in the market are reported to be flouting the order, thereby, causing distortions in the market.

Bulk of trapped funds yet to be trapped – Foreign airlines

However, foreign airlines confirmed that some trapped funds were received yesterday but said it was not true that all the trapped funds have been paid.

A foreign airline representative who spoke with our correspondent in confidence said what the CBN did was to clear all IATA matured bids and tickets sold via BSP (billing settlement platform).

“But airlines still have their bids through banks that are yet to come in. Also direct tickets sales by airlines remain,” the source said pleading not to be named as only the International Air Transport Association (IATA) would give an update on the issue before the end of the week.

President of the Association of Foreign Airline Representatives in Nigeria (AFARN), Dr. Kingsley Nwokoma demanded the breakdown of the “verifiable bids.”

He said what has been paid so far is still “very tiny” compared to what the airlines are being owed.

“At least they have done something, they can have an agreement where they can be paying quarterly in a systematic manner. We know it is above $800m.

“But let them break it down so that we can know what is verifiable. You have given $61m and $64m now. Technically they said they have paid over $130m now. It is easy, there is no big deal about it. This is what is verifiable but we all know what the airlines have been talking about.”