JUST IN: IATA Alerts FG, Possibility Of Foreign Airlines Exiting Nigeria

JUST IN: IATA Alerts FG, Possibility Of Foreign Airlines Exiting Nigeria                                                                                                                                                                                                       ....KINDLY READ THE FULL STORY HERE▶

The International Air Transport Association (IATA) has issued a warning to the Central Bank of Nigeria, cautioning that certain foreign airlines might be compelled to exit the Nigerian market if the ongoing issue of $790 million ticket revenue trapped in the country is not addressed.

Kamil Alawadhi, the IATA Regional Vice President for Africa & Middle East, shared this concern during a media presentation with African journalists at the IATA Global Media Day in Geneva, Switzerland. He also highlighted that despite the poor state of their infrastructure, Lagos and Abuja airports have been ranked as the most expensive gateways in the region.

Alawadhi revealed that Nigeria currently holds the highest amount of airline-trapped funds globally, totaling $792 million. The blocked funds in other countries include Egypt ($348 million), Algeria ($199 million), AFI zone ($183 million), and Ethiopia ($128 million). While Ethiopia has taken steps to address the issue, Nigeria has yet to implement any measures.

He emphasized the need for engagement between parties to resolve the blocked funds issue. Alawadhi mentioned that he has been unable to engage with Nigeria’s CBN Governor, who expressed willingness to engage when a solution is available. However, he has engaged with the Aviation Minister, who has shown understanding and may help resolve the matter.

Discussing the challenges faced by airlines in Nigeria, Alawadhi pointed out the high-interest rates on loans (25%), exorbitant airport taxes, and insurance premiums six times higher than the global average. He emphasized the difficulty for Nigerian airlines to turn a profit under these conditions and highlighted that airlines operating outside Nigeria have lower operating costs and better prices.

IATA is actively identifying the reasons behind these high costs and working to address them systematically, aiming to reduce operating costs for African airlines and improve their profitability.