The Central Bank of Nigeria (CBN) has announced the disbursement of $61.64 million to foreign airlines through various Deposit Money Banks (DMBs).
This disbursement, as disclosed by Mrs. Hakama Sidi-Ali, the Acting Director of Corporate Communications in Abuja on Sunday, aligns with the CBN’s commitment to clearing the backlog of pending matured foreign exchange in DMBs.
The initiative is part of the CBN’s ongoing efforts to reduce its outstanding liability to the airlines. Additionally, Sidi-Ali mentioned that in the last three months, the CBN has successfully redeemed outstanding forward liabilities amounting to nearly $2 billion.
She said, “This underscores the CBN ’s commitment to the resolution of pending obligations and a functional foreign exchange market.”
“These payments signify CBN’s ongoing efforts to settle all remaining valid forward transactions, to alleviate the current pressure on the country’s exchange rate.”
“It is anticipated that this initiative would provide a considerable boost to the Naira against other major world currencies and further increase investor confidence in the Nigerian economy,”
Backstory
In recent times, foreign companies operating in Nigeria have faced challenges in repatriating profits or capital due to a shortage of USD in the Central Bank of Nigeria, leading to a significant backlog amounting to billions of USD.
We highlighted the extent of trapped funds for international airline operators in Nigeria, reaching a staggering $812.2 million, the highest globally.
Addressing the issue during his senate screening, the Governor of the apex bank emphasized that the new team’s immediate priority is to clear the backlog of FX owed to businesses, estimating the figure to be around $7 billion.
In November, our correspondent previously reported the initiation of the clearance process for the FX backlog by the country’s lender of last resort. This was confirmed when PZ Cussons announced it has started to repatriate cash back to her holding company in the United Kingdom