Aviation Blues: Emirates reduces Nigeria operations over inability to repatriate $85m proceeds

*Emirates Airlines, in a communication to Nigeria’s Minister for Aviation, says the planned reductions in its operations in the West African country takes effect from August 15, 2022

Isola Moses | ConsumerConnect

Emirates Airlines, the flagship airlines of the United Arab Emirates (UAE), has declared its intention to prune down flight operations to Nigeria due to its inability to repatriate about $85 million in revenue.

ConsumerConnect reports the leading airline stated  this development in a letter addressed to Hadi Sirika, Honourable Minister for Aviation.

Sheik Majid Al Mualla, Emirates Airlines Divisional Senior Vice-President (DSVP), International Affairs, signed the letter.

In its communication to the Minister, Emirates said the planned reductions in its operations in the country would take effect from August 15, 2022.

According to the aviation company, flights would be reduced from 11 per week to seven at the Murtala Muhammed International Airport (MMIA), Ikeja, in Lagos.

The letter also stated: “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.

“As of July 2022, Emirates has US$85 million of funds awaiting repatriation from Nigeria.”

Emirates further noted “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.

“We simply cannot continue to operate at the current level in the face of mounting losses, especially in the challenging post-COVID-19 climate.”

It said: “Emirates did try to stem the losses by proposing to pay for fuel in Nigeria in Naira, 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, we also have to send hard currency into Nigeria to sustain our own operations.

“Meanwhile, our revenues are out of reach, and not even earning credit interest.”

The Airlines as well noted: “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.”

The letter also indicated that “meetings were also held with Emirates’ own 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.”

Emirates added: “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.”