CBN Includes Airlines in Interbank Foreign Exchange Market

By Chinedu Eze

After months of agitation, the federal government has included airlines in the Interbank Foreign Exchange Market. By this development, airlines would now be given priority when they request for foreign exchange, along with others also shortlisted.

Minister of State, Aviation, Senator Hadi Sirika, who made this known at the weekend, said that this was made possible following the dogged efforts of his Ministry, the airlines through the Airline Operators of Nigeria (AON) and his personal negotiations.

Since last year, the airlines had been pushing for this inclusion because everything about aircraft management and repairs is imported, including training and even manpower engagement.

“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 is will be a huge succor to their operations”, Sirika said.

In a circular sent by CBN to the concerned sectors, it said: “In order to further engender market confidence, ensure access to FX by end users and sustain the integrity of the Nigerian Inter-bank FX market, the Central Bank of Nigeria (CBN) has resolved to intervene in the Inter-bank FX market through forward settlement.”

The inclusion of airlines in the interbank market was designated as Special Secondary Market Intervention Sales (SMIS).

CBN explained that the exercise was to clear backlog of the sectors concerned adding, “This is an important one-off exercise dedicated to the clearance of the backlog of matured FX obligations for: Raw materials and machineries for manufacturing companies; agricultural chemicals; and airlines”.

Since early this year, Sirika has facilitated meetings between AON and the CBN, Nigeria Customs Service and the Ministry of Petroleum resources on how to enhance airline operation, secure forex, tariff waiver and access to aviation fuel at cheaper prices.

The Managing Director of Arik Air, Mr. Chris Ndulue, who confirmed the inclusion of the airlines in the interbank forex market, said Arik was notified about the change at the weekend.

“Our bank told us yesterday that airlines have been included in the interbank forex market and they asked us to now make our request for forex because all the ones we had made in the past did not receive positive response, so we are going to make a new request,” he said.

“We have been agitating for this for a long time. The banks told us that both manufacturers and airlines have been included so we need to reapply. But this is still a promise until it happens,” Ndulue said.