Emirates plans to reduce Nigeria service due to trapped revenue – letter

By Libby George

LAGOS (Reuters) – Dubai’s Emirates plans to cut back flights to Nigeria this month on account of troubles repatriating income from Africa’s most populous nation, in keeping with a letter despatched to the federal government and seen by Reuters.

Emirates plans to chop the variety of flights to Lagos to seven from 11 by mid-August, the letter stated, including it had $85 million caught within the nation as of July, a determine that had been rising by $10 million per thirty days.

Trade observers say extra airways may comply with go well with if the central financial institution, which restricts entry to overseas forex to deal with a extreme greenback scarcity, didn’t tackle airways’ points.

“We have now no alternative however to take this motion, to mitigate the continued losses Emirates is experiencing because of funds being blocked in Nigeria,” it stated in a letter to aviation minister Hadi Sirika dated July 22.

A spokesperson for the aviation ministry didn’t reply to a request for remark.

Emirates, in an emailed assertion, stated hassle repatriating funds was impacting its industrial viability in Nigeria and that efforts to unravel the issue had been met with restricted success.

Emirates didn’t remark immediately on the letter and stated it hoped to proceed a full schedule.

Final week, the naira’s black market worth versus the greenback dropped to a file low. The central financial institution stated it was apprehensive concerning the naira’s worth.

Nigeria, which will get roughly 90% of its overseas change from oil, is struggling to provide on account of pipeline theft and years of underinvestment.

Amid related overseas change restrictions in 2016, a number of airways lowered flights and carriers Iberia and United Airways stopped flying to Nigeria altogether. The latter re-launched a Nigerian service final yr, however Iberia has but to return.

The Worldwide Air Transport Affiliation stated in June Nigeria was withholding a whole bunch of thousands and thousands in income that worldwide carriers working within the nation had earned.

(Further reporting by Camillus Eboh in Abuja and Maha El Dahan in Dubai; Enhancing by Mark Potter)