BusinessDay

Airlines’ trapped funds: ‘Relevant authorities are working on it’, says Lai Mohammed

...5 airlines to commence operations at new Lagos terminal Sept 1

Lai Mohammed, the minister of Information and culture has assured that relevant authorities are working towards ensuring the issue of trapped funds is being addressed as soon as possible.

This assurance is coming at a time when foriegn airlines have reduced the frequency of their flights into Nigeria and Emirates Airlines has disclosed plans to suspend operations over it’s trapped funds in Nigeria.

The International Air Transport Association (IATA), last week revealed that the trapped fund have since grown to $464 million in July, urging government to prioritize the release of the funds.

Speaking during a facility tour at the new Lagos airport international terminal, Mohammed said “On the trapped funds, I can tell you that the relevant authorities are working hard on that issue.”

On delayed commencement of flight operations at the new Lagos terminal, he said there is a need to first test-run the facility and be extremely certain that every equipment is working optimally before the terminal is being put into use.

“I was here 40 years ago when the first terminal was commissioned. There is a time between the commissioning of an airport and when the airport becomes operational. You know aviation is unforgiven of any mistake. So we need to test-run and be extremely certain that every equipment is working optimally,” Mohammed said.

The minister said the Chinese loan used to facilitate the building of the new terminal would be paid back, adding that
the major problem is that the tax to GDP ratio is so low because most Nigerians don’t pay tax.

He however appealed to Nigerians to help government in paying their taxes, so that there would be reduction in deficit the country is experiencing.

Read also: Airlines, travellers adjust as trapped funds up 364%

“The new International Terminal 2 of the Murtala Muhammed International Airport, Lagos, was not built to replace Terminal 1 but to complement it and that is why passengers could check in at one terminal and board at the other. This is first terminal added to the original terminal since it was built some 40 years ago.

“The Terminal 2 Project started in 2013 and was completed by the present administration in 2022 under a bilateral agreement with the People’s Republic of China. The terminal, which has state-of-the art facilities and fittings, has the capacity to process 14 million passengers per annum,” the minister added.

He hinted that there is a whole new experience in terms of aesthetics, comfort, free trolley services, hotel and premium lounges, friendly customer services and free wifi and over 10,000 direct and indirect job opportunities have been created in the news terminal.

Also speaking at the event, Rabiu Yadudu, the managing director of the Federal Airports Authority of Nigeria, (FAAN) said FAAN would rather take its time than start flight operations at the new airport on the wrong footing, adding that this does not mean nothing is being done.

He disclosed that from the 1st of September, which is in the next two weeks, five more airlines are scheduled to start operations in the new international terminal.

Yadudu said a lot of integration has to be done and more than eight airlines have shown interest in starting operations at the new terminal but five are starting from 1st of September.

“There is a connecting area with the old terminal where passengers will move from one terminal to the other. We need the aircraft to be able to park at one side. The second part is that FAAN is working with the federal government to ensure the clearing of obstruction so that there will be accessibility for the planes to park in that area.

“In terms of the businesses, some of these business of duty free is an international business and it takes time for them to be able to come, especially when you are coming to a government operated area, there are a lot of due process. Most of the basic ones are there such as the Bureau De Change (BDCs), the restaurants, pharmacies and these are the essential ones. In the next few weeks, we will have some of the duty free start up,” he said.

Also speaking after the tour, Musa Nuhu, director general, Nigerian Civil Aviation Authority, (NCAA) refuted reports that the authority increased aircraft landing and parking fees.

“I am not aware and I have not authorized any charge increase. Misinformation is creating a lot of problems. The truth of the matter is that the last time NCAA increased it’s charges was 10 years ago. If we were charging N5,000 10 years ago and we are still charging same amount, it means we are not recovering our costs.

“We are providing services and subsidizing it. We understand the difficulties facing the industry now, but going forward, we have to sit down and review it because NCAA does not get any money from federal government. All our revenues are internally generated and we need the revenues to provide the appropriate services for the safety, security and efficient service delivery to the public. NCAA can also not increase any charge without having a stakeholders consultation,” Nuhu explained.