The Central Bank of Nigeria has approved a Special Secondary Market
Intervention Retail Sales for airlines operating in the country to
enable them to access foreign exchange.
The Deputy Director, Press and Public
Affairs, Ministry of Transportation, Mr. James Odaudu, announced the
plan in a statement in Abuja on Friday.
Odaudu explained that the intervention
was a direct result of the interaction with CBN by the Minister of
State, Aviation, Sen. Hadi Sirika, on behalf of the airlines.
He said the intervention was an
important one off exercise dedicated to the clearance of the backlog of
matured foreign exchange obligations.
Odaudu said the resolution by the apex
bank to intervene in the interbank foreign exchange market through
forward settlement was expected to engender market confidence.
He said that it would also ensure access
to Forex by the airlines to settle their obligations and sustain the
integrity of the Nigerian Inter-Bank Foreign Exchange market.
He said, “The import of this peculiar
exercise is that the CBN will not apply the relevant provisions under
clause 2.4.3 (i) of its Revised Guidelines for the Operation of the
Nigerian Inter-Bank Foreign Exchange Market.
“It provides that ‘all SMIS bids shall be submitted to the CBN through the FXPDs.’
“Consequently, CBN shall receive bids from all the authorised dealers.
“The CBN will also not apply the
relevant provisions 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.’
“According to the CBN, whereas the bids
are on Spot Forex basis as the Authorised Dealers’ accounts with the CBN
will be debited in full for the naira equivalent of the dollar bid
amount.
“The CBN will settle the bids through forward settlements of two months.”
He said that customers that were not
willing to accept the settlement terms had been advised not to
participate in this Special SMIS- Retail.
Odaudu credited Sirika as describing the special intervention by CBN as a “great relief’’ for airline operators in the country.
He said the operators had complained
bitterly over their inability to access the required Foreign Exchange to
settle the backlog of their obligations which had adversely affected
their operations.
Sirika said the aviation sector was
critical to the nation’s economy, adding that CBN had taken the right
decision that would strengthen existing airlines and inspire confidence
in aspiring operators.
The airline operators at a recent meeting with the minister complained of a lack of access to Forex.
The airlines said that many airlines were not operating profitably.
Sirika, at the meeting promised, to take
up the issues with the authorities of the apex bank and seek for
intervention on their behalf.
Also to benefit from the intervention is raw materials and machineries for manufacturing companies and agricultural chemicals.
NAN
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