Nigeria is set to lose revenue accruing from foreign airlines operating in Nigeria as most of the airlines have decided to cut down on operations in the country following the refusal of the Nigerian government to allow them repatriate their trapped funds.
Al Awadhi said as of April, a total of $1.6 billion in funds were blocked by 20 countries worldwide — with 67 percent of it tied up in 12 African nations.
“Nigeria alone is holding back $450 million. It is the most amount blocked by any single African country, and the amount is rising every week,” Al Awadhi had complained.
According to him, cash flow is key for airlines’ business sustainability — when airlines are unable to repatriate their funds, it severely impedes their operations and limits the number of markets they can serve.
Recently, Emirates Airlines, the flag carrier of the United Arab Emirates (UAE), said it would reduce flight operations to Nigeria over the inability to repatriate about $85 million in revenue.
“We have had no choice but to take this action, to mitigate the continued losses Emirates is experiencing as a result of funds being blocked in Nigeria,” the airline said in a recent statement.
It was learnt that the federal government’s refusal to allow access to the sum is leading to increasing restrictions imposed by airlines on tickets out of Nigeria.
According to a source, some airlines have “dramatically restricted which classes can be sold to enable them to collect more naira per seat to offset their currency exchange woes.”