Emirates Cutting Flights to Nigeria in Attempt to Secure withheld revenues
Dubai-based carrier, Emirates says it will be forced to slash the number of flights it operates to Nigeria because it has US $85 million in revenues stuck in the West African country that government officials are refusing to allow to be repatriated back to the United Arab Emirates (UAE).
According to the carrier, Nigeria has withheld more than $850 million in revenues from international airlines because of a severe U.S. Dollar shortage. Nigeria wants to hold onto as much money as possible and is refusing to release cash despite the “considerable efforts” of the likes of Emirates.
“It is with a heavy heart that I write to inform you of planned reductions in Emirates’ operation to Nigeria,” wrote Sheikh Majid Al Mualla, the airline’s senior vice president of international affairs in a letter to Nigeria’s minister of aviation last week.
With effect from 15 August 2022, Emirates will be forced to reduce flights from Dubai to Lagos from 11 per week to 7 per week,” the letter continued. “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.”
Sheikh Al Mualla claims $85 million in revenues has already been withheld by the Nigerian government and that figure is growing by $10 million every month.
“These finds are urgently needed to meet our operational costs and maintain the commercial viability of our services to Nigeria,” warned Al Mualla. “We simply cannot continue to operate at the current level in the face of mounting losses, especially in the challenging post-COVID-19 climate”.
The airline is reportedly having to fly hard cash in Nigeria to pay for services in the country and keep its operations running. Al Mualla says they offered to pay for fuel in Nigeria’s local currency but this suggestion was rebuffed by the supplier who wanted U.S. Dollars.
Emirates will be cutting its flights from Dubai to Nigeria from eleven weekly flights to just seven, effective August 15th, 2022. Image: Emirates
So far, attempts by Emirates and the International Air Transport Association (IATA) to find a solution have failed and Al Mualla claims the “situation continues to deteriorate”.
IATA boss Willie Walsh has also lamented on withheld airline revenues by several African governments during the recently concluded IATA AGM.
In addition to Nigeria, other countries on the spot including Algeria, Ethiopia and Zimbabwe are also refusing to repatriate dollars out of their respective countries.
Despite the Nigerian market importance for its operations, Emirates has had a fairly difficult relationship with the country over the last few months. During the pandemic, Emirates was banned from flying to Nigeria for several months because of additional Covid testing rules it required of Nigerian passengers.
Late last year, Emirates also suspended flights to Nigeria for a brief period over a tit-for-tat slot dispute.