Travelers groan as international air fares skyrocket
Airlines’ $812.2 million remains trapped in Nigeria
Nigerians traveling abroad are now struggling to meet up with rising air fares as the fluctuation of foreign exchange bites the air travel sector.
Many of the passengers have now resorted to booking and paying for their oversea trips in neighbouring countries including Ghana , Benin and Republic of Togo where lower fares are obtainable.
An investigation showed that fares on international routes from Nigeria have been on the rise over the last few months and especially so since the introduction of the single forex market.
Most hit by the development are flights to Europe , Middle East and the United States.
Passenger traffic,which usually peaks on the approach of summer,has dipped considerably owing to the rising air fares.
The spike in fares is one of the direct results of the depreciation of the naira brought about by the cancellation of the parallel forex market.
International air fares are often denominated in the US Dollars.
A passenger who does not want to be named said the situation has forced many intending travellers to weigh their options before embarking on any trip.
The global airlines’ body International Air Transport Association (IATA) said, last week, that the increase in fares was inevitable since they are denominated in dollars and converted into the local currency, for sale in the Nigerian market.
These conversions, IATA said, use the official prevailing exchange rate provided by the country’s financial system.
These conversions, IATA said, use the official prevailing exchange rate provided by the country’s financial system.
” IATA simply applies the spot rate at which the Central Bank of Nigeria sells USD through banks to the market, at its fortnightly retail foreign exchange auctions,” it said.
“The rate is not static. If the rate at which the CBN sells US Dollars goes up, the exchange rate applied to airfares will follow and vice versa.”
Under the new dispensation, a Lagos / London return trip now attracts an average of N1.4million,according to the booking inventory by a travel management company.
A July 2,2023 booking for direct flight costs N1.2 million for a direct flight.
A direct / transit / connecting flight on Royal Dutch KLM Airlines on the same day goes for N1.3 million.
On Air France, booking for the same date for direct flight costs N1.4 million . Transit / connecting flight on the Lagos / London route is going for N3.4 million.
On Lufthansa German Airlines, booking for the same date on direct routing is going for N1.5 million. Connecting / transit flights are going for the same amount.
On Ethiopian Airlines, booking for direct flights on the same destination is going for N1.5 million.
Connecting / transit flights on the same destination is going for N1.6 million.
Booking options to Dubai,UAE, a favourite destination for many Nigerian travellers, offer intriguing rates.
Direct booking on Ethiopian Airlines for July 2, 2023 is N1.2 million while transit / connecting flights for the same routes for July 2, 2023 has on offer a fare structure of N1.6 million.
On Qatar Airways, booking for the same travel date is offering a fare regime of N1.8 million for direct routing. Connecting/ transit flights for the same date present same fare.
For travels to continental United States- Lagos / New York for July 2, 2023 the fare offering on Royal Air Maroc is going for N1.6 million , Ethiopian Airlines N1.9 million , Air France N2.5 million , Delta Airlines N2.5 million and Kenya Airways N2.7 million; which are on direct routing regime.
Foreign carriers say they currently have over $812.2 million from ticket sales trapped in Nigeria.
Nigeria is ahead of Bangladesh with $214.1 million , Algeria with $196.3 million , Pakistan with $188.2 million and Lebanon trailing fifth with $141.2 million.
IATA’s Director General and Chief Executive Officer, Willie Walsh, said at the recent Annual General Meeting & World Transport Summit of the world’s airline body in Istanbul, Turkey, that rapidly rising levels of blocked funds constituted a threat to airline connectivity in the affected markets.
The industry’s blocked funds , Walsh said, increased by 47 percent to $2.27 billion in April 2023 from $1.55 billion in April 2022.
Walsh said, “Airlines cannot continue to offer services in markets where they are unable to repatriate the revenues arising from their commercial activities in those markets.
“Governments need to work with industry to resolve this situation so airlines can continue to provide the connectivity that is vital to driving economic activity and job creation.”
