Aviation: Major airlines pulling out of Nigeria
Major international airlines are deserting Nigeria citing the free-falling local currency and an economic crisis that has seen government introducing tighter foreign currency exchange controls.
United Airlines, the third largest United States based carrier by revenue, has become the latest airline to pull out of the West African economic giant with its flights ceasing by June 30.
The airliner cited reduced revenue, which has been blamed on the deteriorating value of the naira and tight currency controls by the government as some of the reasons for the decision to stop flying to Nigeria.
United Airlines followed on the footsteps of British Airways, Spanish national airline Iberia, Air France-KLM, Qatar Air, and Etihad, who were also unsettled by the Nigerian government’s given restrictions on the repatriation of revenues on tickets sold in naira.
Nigeria has struggled with dwindling foreign reserves due to the downturn in the energy sector as oil prices dropped globally.
The government, in a bid to manage foreign exchange outflows, placed restrictions after it limited money transfers out of Nigeria. The policy has hit international carriers hard as their funds have been trapped funds at the Central Bank of Nigeria (CBN).
According to the International Air Transport Association (IATA), international are owed about $575 million by the central bank.
Sources have also revealed that the international airlines have been going through a hard time as they were not able to record a “high load factor”.
