Airlines consider reducing flights to Nigeria next year in response to CBN directive

INTERNATIONAL airlines operating in Nigeria plan to the number of flights into and out of the country next year in response to the government's new directive limiting the ability of investors to repatriate profits they have made in the country.

 

Earlier this month, the Central Bank of Nigeria (CBN) issued a new directive prohibiting investors from exchanging billions of naira they have accrued into dollars and repatriating it. This new measure automatically created a scarcity of foreign exchange and has limited Nigeria's appeal as an investment destination.

 

Unhappy about the directive, the International Air Transport Association (IATA), recently pleaded with the CBN governor, Godwin Emiefele to intervene in the matter and make dollars available to the airlines. However, so far, nothing has been done yet, although he gave assurances to the world body, that he would look into the matter.

 

In addition, the foreign airlines also met with the transport minister Rotimi Amaechi and urged him to look into their case. Exasperated with the government, the airlines have decided to act and as from March 2016, British Airways plans to reduce its flights to Nigeria by bringing in smaller aircraft than the traditional Boeing 747, which operates the lucrative Lagos-London route.

Other foreign airlines may either change their aircraft type and operate ones with smaller capacity or reschedule and reduce the number of flights to Nigeria. Those which are not major players in the Nigerian market may stop flights to the country altogether.

One BA source said: "Some parents whose children are in school overseas are considering withdrawing them as our economy, which has become the strongest economy in Africa is grinding to a halt. We don’t want to make our plan to reduce operations public because we don’t want to cause any panic.

 

"This will affect everybody and it is going to also affect my staff because some of them might lose their jobs. BA will definitely reduce service, which is a decision we must have to take.”

He noted that failure to repatriate the airline’s revenue is affecting aircraft leases and fuelling as the money so generated is used to pay for fuel and renew aircraft leases. The source also suggested that CBN should endeavour to provide foreign exchange to the essential service sector so that the economy would not grind to a halt.