$600m trapped funds: Foreign airlines’home countries uncomfortable

The home countries of the foreign carriers whose $600 million was trapped in the Nigeria’s Central Bank are said not to be comfortable with the care-free attitude displayed by the Nigerian government.

Some of the foreign countries which are said to be monitoring the situation between now and December; the period many ofthe airlines gave the Nigerian government to pay the accumulated funds or watch them pull out of the country, maytake up the issue directly with Nigeria.

The final intervention of the foreign countries has been attributed to the fact that the failure of the CBN to release the trapped funds for the airlines to repatriate to theirhome countries contravened the agreement signed between them and Nigeria as stipulated in the existing Bilateral Air Service Agreements (BASAs).

This is just as the seeming silence of the various localbankers of the foreign airlines in Nigeria has been attributed to the fact that it is only the CBN that is empowered to do this.

According to one of the airlines’ manager in Nigeria, who spoke under anonymity said “the issue of the local banks is primary in this issue since they cannot dictate for their clients. All interactions should be with the CBN as other banks cannot do much. Local banks are insignificant.”

When the Nigerian Tribune inquired from the International Air Transport Association (IATA), the clearing house for over 300 airlines worldwide if they have reached out to the local bankers of the foreign carriers in Nigeria as a way of helping the airlines to access and repatriate their funds out of the country, the international body declared “As the industry leader and representative body, IATA engages with the government authorities on matters of common interest to its member airlines. In this instance, IATA has been in regular contact and appealed to Federal Government Nigeria and the Central Bank to release foreign airlines’ revenues generated in Nigeria.”

A source at one of the banks said it would be a breach of client confidentiality if a local bank engaged with a third party on matters relating to one of its account holders.

While he said the airlines themselves must have been in touch with their local banks, the source therefore explained thatan international body like IATA cannot intercede within dividual banks on the relationships the local banks have with their individual airline clients.

In his own comment, the Managing Director of Centurion Aviation Security, retired Group Captain John Ojikutu, though agreed that the local banks could not approach the CBN directly for forex  transfers, but explained that “The airlines’bankers are the sole agents of forex transactions not the CBN, same way an individual requests for BTA. Yes there may be shortage of forex at the domiciliary bank and even at the CBN, but the call must come from the domiciliary banks to the account holder and not the CBN.

“The airlines cannot approach the CBN directly for forex transfers, so I think. Don’t trust most of these banks when it comes to issues about forex because they benefit from the dues of their customers. They rather would give forex in their custody to those that have no CBN considerations.

Meanwhile, the Minister of Information and Culture, Alhaji Lai Mohammed has said that “On the trapped funds, I can tell you that the relevant authorities are working hard on that issue,” he said.

Speaking on if the loans obtained from China and other institutions were well-utilised and would be paid back as stipulated in their contract terms, the minister expressed optimism that the loans obtained by the Federal Government for infrastructure purposes were being judiciously used, but regretted that most Nigerian citizens don’t pay taxes to the government.

He appealed to Nigerians to ensure prompt and adequate payment of taxes for the growth of the country.

The Nigerian government had secured a $500 million loan deal from the Exim Bank of China for the construction of five new terminals, while additional counterpart funding of $100 million was added by the Federal Government.

Construction commenced on the Lagos new international terminal by the Chinese construction company, China Civil Engineering Construction Corporation (CCECC), in 2013 with a completion period fixed for 20 months.

Concerns were, however, raised by the public about the repayment plans by the Federal Government.

Lai Mohammed said, “It is not actually taking the money that is the problem, but what we do with the money. When loans are used and invested in infrastructures such as this, then it means the loans are wisely used.

“The major problem is that the tax to the Gross Domestic Product ratio is so low because most Nigerians don’t pay tax. So, I want to appeal to Nigerians to help the government in paying their taxes, and then there will be a reduction in the deficit that we are experiencing.”

The minister further expressed satisfaction at the new Lagos airport terminal, stressing that the facilities in the terminal were comparable to anywhere else in the world.

He explained that the new terminal was built to complement the old terminal, which was constructed in 1979, stressing that the terminal with eight security screening points, seven passenger boarding bridges and six boarding gates, has the capacity for 14 million passengers annually.

Commending President Muhammadu Buhari for supporting infrastructure development in the country despite the challenges maintaining that no past governments in the country had shown much commitment to infrastructure in the country.

Mohammed said “I was here 40 years ago when the first terminal was inaugurated. You know aviation is unforgiving of any mistake. So, we need to test-run and be extremely certain that every equipment is working optimally.

“The beauty of it is that this airport has become operational. You can come here and continue to various parts of the world.

“When the old airport was inaugurated, it took quite a while for it to become operational. The new international terminal is not to replace the old one, but to complement it. It is gradually, and very soon this airport will be very busy.

“You can see that terminals are not used only by airlines. We have restaurant operators, banks, foreign exchange operators and others. And you have to screen people over and over again before it becomes operational”.

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