“The Status Quo Still Remains”: Mixed Reactions Trail CBN’s Forex Clearance Claim

• The central bank recently claimed it has completed closing the remaining balance of the foreign exchange backlog
• Reactions have trailed the claims as stakeholders in the aviation industry expressed how the development affected them
• The Association of Foreign Airlines and Representatives in Nigeria and the International Air Transport Association shared diverse views on the issue

Legit.ng journalist Zainab Iwayemi has over three years of experience covering the Economy, Technology, and Capital Market.

The financial regulator recently claimed it completed the payment obligations to bank clients, essentially closing the remaining balance of the foreign exchange backlog, a statement released on Wednesday by Hakama Sidi Ali, acting director of corporate communications at CBN had disclosed.

Reacting to this, Foreign airlines, according to a BusinessDay report, argue that nothing has changed despite the Central Bank of Nigeria (CBN) statements that it has successfully satisfied all outstanding foreign exchange (FX) obligations.

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According to Kingsley Nwokeoma, President of the Association of Foreign Airlines and Representatives in Nigeria (AFARN), no progress has been made in freeing up monies that foreign airlines have become stuck with.

Nwokeoma said:

“If they say they have cleared the trapped funds, they should show us figures. They should tell us how much has been cleared. The last I checked, the status quo remains the same,”

A different story

However, Bankole Bernard, the head of the International Air Transport Association's (IATA) Airlines and Passengers' Joint Committee (APJC), said BusinessDay that CBN's assertion is accurate and that the airlines' trapped cash had been released.

He claims that although foreign airlines were given the chance to obtain their money from the banks using the I & E window rate, they declined because the rate at which they sold tickets differed from the current rate.

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Bernard explained that because the airlines would lose money if they collected the money through the I & E window, they stopped selling tickets with low inventory and are now only offering costly fares to compensate for the money they lost due to the current exchange rate.

When asked why Emirates hasn't started flying again in Nigeria, he explained that it can't because of its diplomatic spat with the country.

He said:

“The crimes Nigerians are committing in Dubai have made them refuse Nigerians from coming to Dubai. These crimes affect tourism. They do not want their country to be perceived as unsafe. Emirates still has their office in Nigeri,a and they have staff they are paying salaries.”

Nigeria had the most significant amount of trapped funds globally, with $812.2 million out of $2.27 billion, according to information released by the International Air Transport Association (IATA) last year.

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Cardoso-led CBN sacks directors

Legit.ng reported that with the departure of some of the directors, there are signs that Olayemi Cardoso has started what is perceived as a gradual cleansing at the top bank.

According to BusinessDay, a few of the directors who were asked to leave were employed by the former governor of the CBN, Godwin Emefiele.

A close associate of one of the directors who wished to remain anonymous said the dismissal was not so much a retirement as an outright firing.

Source: Legit.ng