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Air Peace hails CBN for sector’s forex soft landing

Emerging strong force in domestic air travel, Air Peace has described the special foreign exchange (forex) procurement window granted airlines and manufacturers by the Central Bank of Nigeria (CBN) at the weekend as a great relief to the aviation industry.

In a statement signed by its Chairman/Chief Executive Officer, Chief Allen Onyema, Air Peace commended President Muhammadu Buhari, the Minister of State for Aviation, Senator Hadi Sirika and CBN Governor, Mr. Godwin Emefiele for heeding the calls of the airlines to intervene in the foreign exchange situation.

The development, the airline said, was an assurance that the Federal Government was willing to permanently address the other issues affecting the aviation industry such as high cost of aviation fuel, multiple taxation, among other operational challenges of airlines in the country.

“We welcome the news of the intervention of the Federal Government in the foreign exchange crisis confronting airlines in the country with a heart of gratitude. We had on different occasions appealed to the Federal Government to save airlines in the country from collapsing. The operations of airlines in the country are largely dependent on the availability of the scarce foreign exchange, a situation which has threatened the existence of the airlines.

“The intervention of the Federal Government in the crisis through the CBN is, therefore, a great relief. The tireless efforts of the Minister of Aviation, Senator Hadi Sirika, to this end and his unrelenting efforts to ensure a smooth operating environment for airlines are highly commendable.

“The intervention, we believe, is a reassuring sign that other challenges confronting the indigenous airlines such as difficulty in sourcing aviation fuel, the issue of multiple taxation and, most worrisome, the issue of multiple designation into Nigerian cities granted to foreign airlines will soon be decisively addressed.

“On our part, we are always ready and willing to support and cooperate with the Federal Government in its efforts to tackle the current economic recession and ensure a strong economy,” the group noted.

It would be recalled that CBN approved special secondary market intervention retail sales of foreign exchange for airlines operating in the country.

A statement from the aviation arm of the Federal Ministry of Transportation weekend said the arrangement is dedicated to the clearance of the backlog of matured foreign exchange obligations.

To benefit from the intervention, according to the ministry, include importers of raw materials and machineries for manufacturing companies and agricultural chemicals.

It noted that the resolution by the apex bank to intervene in the interbank forex market through forward settlement was expected to engender market confidence, ensure access to forex by the airlines to settle their obligations, and sustain the integrity of the Nigerian interbank foreign exchange market.

The statement noted that the implication of the intervention was that the CBN would not apply the Clause 2.4.3 (i) of the Revised Guidelines for the Operation of the Nigerian Interbank Foreign Exchange Market, which provides that “all SMIS bids shall be submitted to the CBN through the FXPDs.”

The ministry stated that consequently, the CBN shall receive bids from all the authorised dealers and would also not apply the relevant provisions under clause 2.4.3 (i) of the guidelines, which provide that “spot forex sold to any particular end-user shall not exceed one per cent of the overall available funds on offer at each SMIS session.”

The Minister of State for Aviation, Senator Hadi Sirika, described the special intervention by the central bank as a great relief for airline operators who had complained bitterly over their inability to access the required foreign exchange to settle their backlog of obligations.

Sirika noted that he apex bank had taken the right decision that would not only strengthen the existing airlines, but also inspire confidence in aspiring operators in Nigeria’s aviation industry.

The minister added that the development is coming after intervention by the Federal Government through the Ministry of Aviation on behalf of the foreign airlines and domestic operators under the aegis of the Airlines Operators of Nigeria.

“This is after much intervention on behalf of the airlines, both foreign and domestic. The central bank has yielded and we are happy because this means a lot to us and the airlines. They have been going through a lot and we are so happy that this will be a huge succour to their operations.

He said airline operators in the country had been affected by their inability to access forex to settle their backlog of obligations, adding that their operations had been adversely affected in the process.

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