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By Chinelo Obogo
International airlines will henceforth price tickets at N770 per dollar from N663 per dollar on Nigerian routes, which is about 20 percent increase.
This development is coming after the International Air Transport Association (IATA) has, on Wednesday, pegged $1 to N770.
The international body had few weeks ago warned about the inability of international airlines to repatriate their ticket sales for over a year and the National Association of Nigeria Travel Agencies (NANTA), said the blocked funds have contributed to the high airfares on Nigerian routes.
In the past, an economy ticket from Lagos to London used to cost about N400,000 in 2021 but had increased to about N1.2 million in 2022 and 2023.
Also, business class ticket has to about N6 million during the same period, depending on the airline and time of booking.
With the new benchmark, a N1.2 million economy ticket may rise to N2 million and above, while for the business class, the fares may rise to N7 million or more.
Last month, IATA said that blocked funds belonging to foreign airlines trapped in Nigeria had hit $812.2 million, warning that rapidly rising levels of blocked funds are a threat to airline connectivity in the affected markets.
The industry’s blocked funds have increased by 47% to $2.27 billion in April 2023 from $1.55 billion in April 2022.
The top five countries that account for 68.0% of blocked funds are Nigeria with the highest trapped funds ($812.2 million), Bangladesh ($214.1 million), Algeria ($196.3 million), Pakistan ($188.2 million), Lebanon ($141.2 million)
IATA’s Director General, Willie Walsh said, “Airlines cannot continue to offer services in markets where they are unable to repatriate the revenues arising from their commercial activities in those markets.
“Governments need to work with industry to resolve this situation so airlines can continue to provide the connectivity that is vital to driving economic activity and job creation.”
