NIGERIA Aviation Safety Initiative (NASI) coordinator, Captain Dung Rwang Pam has commended federal government’s move to secure a special sectorial allocation of forex for Airline Operators in the Secondary Market Intervention Sales (SMIS) for Airline operators however, cautioning on the implementation.
Captain Pam who described it as a welcome development however cautioned on its implementation stating that the entire process must be by the book, transparent and accountable.
The seasoned aviator who reacted to the news stated that his call for transparency is important to ensure that shady operators do not increase their requirement and use the forex for round tripping thus calling on the economic monitoring unit of the NCAA to ensure that forex is directed where required.
He said,”It is a welcome development but must be implemented with transparency and accountability at its core and throughout the entire process. It is a welcome development that the (CBN) has decided to grant “currently operating” Nigerian airlines access to the secondary market intervention sales (SMIS). “
“As with most interventions, I hope this not just be a knee-jerk reaction to the clamour for government support to this critical sector. I expect that the entire process will be unambiguously transparent from start to finish, i.e., from the CBN, foreign exchange primary dealers (FXPD), all the way to the benefiting airlines. “
“It is expected that the economic monitoring team of the regulatory agency (NCAA) will ensure that the foreign-exchange is directed and dispensed for the purposes for which it was approved. So that at the end of the process, there will be incontrovertible evidence that there is a return to accountability within the system. “
He went on,“We have witnessed numerous instances where unscrupulous operators over exaggerate their foreign exchange requirements only to end up “round tripping” the excess in the black market and causing further distortion of the actual industry demand. This is unfortunate and needs to stop.”
He explained that both the banking and aviation sectors need to re-acquire are public confidence and credibility stating that this latest trust by government is another opportunity for them to show that they are competent and can be trusted.
Meanwhile, the Nigeria Civil Aviation Authority (NCAA) in an earlier statement today said the special sectorial allocation of forex for Airline Operators in the Secondary Market Intervention Sales (SMIS) is to further engender market confidence, ensure access to forex by the airlines and sustain the integrity of the Nigerian Inter-bank forex market.
According to the regulatory agency, the Central Bank of Nigeria (CBN) has resolved pursuant to the Minister’s show of concern to intervene in the inter-bank forex market through forward settlement.
For clarity, the Special Secondary Market Intervention Sales (SMIS) – Retail is an important one-off exercise dedicated to the clearance of the backlog of matured forex obligation for airlines.
It is however worthy to note that other sectors were similarly availed priority in the inter-bank forex market. These are raw materials and machinery for manufacturing companies and Agricultural chemicals.
It will be recalled that the Director General, Nigerian Civil Aviation Authority (NCAA) had earlier led a delegation of Airline Operators of Nigeria (AON) to hold meetings with the Ministers of State for Aviation, Finance and their Petroleum counterparts including the CBN Governor.
As a result of the meeting, Honourable Sirika was able to extricate for the foreign airlines 50 per cent clearance of their forex obligations. This present success is another step ahead in seamless operations in the aviation industry.
It is expected that this is a major window for those airlines who had earlier ceased their operations to recommence in earnest.
Therefore, with this intervention comes a landmark incentive for both local and foreign operators to carry out safe, secure and lucrative operations in Nigeria.
In addition, all scheduled and mandatory checks which are done in the diaspora will be undertaken with this leverage at a reduced cost.
The Director General of the Regulatory Authority, NCAA, therefore expects the foreign operators to carry out their operations with renewed vigour.
According to him, all problems associated with repatriation is now a foregone conclusion. He advised all Airline Operators to take full advantage of this laudable gesture of the Federal Government of Nigeria and adhere strictly to the provisions of the Bilateral Air Services (BASA) with Nigeria.