By Chinelo Obogo
International flight ticket sales from Nigeria slumped by 40 percent in the last quarter of 2023 due to trapped funds, forex scarcity and restrictions of lower inventories by foreign airlines.
This was revealed in a media briefing organised by the National Association of Nigeria Travel Agencies (NANTA) in Lagos on Tuesday to announce its forthcoming Annual General Meeting, scheduled for April 23-27.
NANTA president, Susan Akporiaye, in her remarks said that compared to the last quarter of 2022, ticket sales for 2023 were very low because majority of the tickets that travel agents were selling were not attributed to the Nigerian market.
“We are still in the first quarter, so the ticket sales report is not out yet but from the assessment of the last quarter, there has been a decline in terms of sales. The sales dropped by 40 percent of what we did in the fourth quarter of 2022. The trapped funds issue, rate of exchange, difficulty in getting forex and the restrictions put by the airlines because of the trapped funds caused the sales in Nigeria to drop. Because of that, our members had to survive in any way they could, so we were selling out of Nigeria. We were doing business and selling tickets but the majority of the tickets we were selling were out of Nigeria and those sales were not attributed to the Nigerian market. I bet you, if we are going to access the Ghana market or any West African country’s market, they would see an unusual growth in sales, while in our own market, there was a downward trend and we knew the reason.
“Foreign airlines closed the lowest fares to us but they were opened in other markets. They only opened the highest fares to us, so, what we did as travel agents was to move our sales to other markets. Interestingly, the travel is still from Nigeria. Your client would be traveling from Lagos to London but the ticket would be bought in Ghana, so that revenue would be attributed to Ghana and not to us. But the percentage in which passenger traffic was reduced was just between 12 and 15 percent. But reduction in sales counted to the Nigerian market reduced by 40%. You can see that it really didn’t stop people from traveling, the 12 percent reduction in travel was because of the exchange rate to buy dollars and travel. Because even if you buy lower inventory in Ghana, you won’t go and buy your forex in Ghana, you’ll buy it in Nigeria, so that hinders a lot of people from traveling.”
On the issue of trapped funds, Akporiaye said, “What used to happen was that foreign airlines would go and bid, once they win the bid, their account would be debited by the Central Bank of Nigeria (CBN), then they would wait for what they call ‘maturity date’ which is usually 90 days. But because of the lack of forex, the 90 days ran into one year. At the time, the bid was done through the CBN and the accounts of the airlines were debited, meaning that the Naira had been collected but the dollar equivalent was not credited to them because of shortage. That is why they said Nigeria was owing the airlines. But when this administration came on board, they looked at the books and knew that they couldn’t continue like that. The government stopped the bidding process and told the airlines to go to the I and E window to source for their funds but that they were committed to paying the ones they were owing. That is what the government has finished paying.”