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Stranded Fund, Foreign Airlines’ Withdrawal To Cost Nigeria $1.36B

Horrible implications await the Nigerian economy should foreign airlines make good their threat to withdraw flight services over stuck budgets estimated to have reached $464 million as of July 2022.?

Stranded fund, foreign airlines' withdrawal to cost Nigeria $1.36b

?Specifically, the exit of foreign carriers that account for 80 percent of commercial aviation revenue to the Gross Domestic Product (GDP) will stagger the projected growth of the air transport sector and cost Nigeria $1.36 billion or N567.12 billion (at $/N417) yearly.?
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The losses, will not be unconnected with well-off Nigerian travelers (in the absence of foreign airlines) departing for neighboring African countries to board the same international flights or paying for those bookings in foreign currencies only.?
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Furthermore, should the airlines demand payment in US dollars, the already saturated parallel foreign exchange market may witness a further weakened naira, as demand outweighs supply for the greenback.?
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Already, things are also not looking up for the country’s sole carrier on the international front. Air Peace airline, yesterday, announced its withdrawal from the Lagos-Johannesburg route over low patronage on account of the South African Embassy’s delay in approving visa applicants in Nigeria, among other operational reasons.?

Source: Guardian Nigeria

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