Le Nigeria is a rich country, very rich, at least on paper. It is Africa's biggest oil producer. In 2021, the Nigeria was producing 1.38 million barrels of crude oil a day, according to OPEC. In July 2022, production even reached 1.8 million barrels. But the country seems to be missing out on this windfall because of erratic stock management and production control problems.
As a result, Nigeria is obliged to import oil to cover its needs, undermining its foreign exchange reserves and the value of its currency. Also, the Central Bank of Nigeria has decided to suspend most foreign currency transfers.
The measure affects airlines. The International Air Transport Association IATA was declared last week". disappointed that the amount of airline funds whose repatriation is blocked by the Nigerian government reached 464 million dollars in July" .
And to drive the point home in a series of tweets. " Airlines cannot be expected to continue flying if they can't make money from ticket sales. The loss of connectivity damages the economy, investor confidence, jobs and people's lives." IATA believes.
The first visible consequence is with Emiratesas the company has decided suspend all flights to Lagos and Abuja until the situation is resolved. In an interview with a Nigerian news website, the Chairman of the Association of Foreign Airlines and Representatives in Nigeria, Kingsley Nwokeoma, believes that other international carriers will follow Emirates. He estimates that more than a billion dollars blocked This includes aircraft manufacturers such as Airbus and Boeing, as well as other operators in the aviation sector.
Rates set to soar
From his side, British Airways has decided to reduce its frequencies to three weekly flights. The airline will also be abolishing its lowest fares and selling its economy class at full fare only. At Air France-KLM seems to be adopting the British Airways pricing strategy. The duo offer a daily flight from Amsterdam with KLM and five direct flights from CDG with Air France. But fares jumped in September, with the average one-way fare rising from €600 to over €1,500 in economy class.
