United Arab Emirates (UAE) carrier, Emirates has said that it will be reducing the number of times it frequents Nigeria from 11 to 7 per week.
This is due to the inability to repatriate funds from sales of tickets.
African Alerts reports that the Nigerian government has been under pressure due to blocked funds belonging to foreign airlines which have hit over $500m.
Emirates alone have $85m trapped funds.
In a letter dated July 22, addressed to the Minister of Aviation, Senator Hadi Sirika, the Emirates, explained they had to take the action to cut down the continued losses Emirates is experiencing as a result of funds being blocked in Nigeria.
The letter read: “It is with a heavy heart that I write to inform you of planned reductions in Emirates’ operations to Nigeria. With effect from 15 August 2022, Emirates will be forced to reduce flights from Dubai to Lagos from 11 per week to 7 per week.
“As of July 2022, Emirates has US$ 85 million of funds awaiting repatriation from Nigeria. This figure has been rising by more than $US 10 million every month, as the ongoing operational costs of our 11 weekly flights to Lagos and 5 to Abuja continue to accumulate.
“These funds are urgently needed to meet our operational costs and maintain the commercial viability of our services to Nigeria.
“Emirates did try to stem the losses by proposing to pay for fuel in Nigeria in Nairas, which would have at least reduced one element of our ongoing costs, however, this request was denied by the supplier. This means that not only are Emirates’ revenues accumulating, but we also have to send hard currency into Nigeria to sustain our operation. Meanwhile, our revenues are out of reach and not even earning credit interest.
“Your Excellency, this is not a decision we have taken lightly. Indeed, we have made every effort to work with the Central Bank of Nigeria (CBN) to find a solution to this issue. Our Senior Vice-President met with the Deputy Governor of the CBN in May and followed up on the meeting by letter to the Governor himself the following month, however, no positive response was received. Meetings were also held with Emirates bank in Nigeria and in collaboration with IATA to discuss improving FX allocation, but with limited success.
“Despite our considerable efforts, the situation continues to deteriorate. We are now in the unfortunate position of having to cut flights, to mitigate against further losses going forward.
“While we appreciate that this issue is primarily a financial one, any support you could kindly provide would be warmly welcomed by Emirates. We are confident that your valuable involvement would make a real difference in improving this very difficult situation.
“Should there be any positive development in the coming days, we will of course re-evaluate this decision. Meanwhile thank you for your understanding and please feel free to contact me if you wish to discuss the matter further.”
