A number of international airlines have announced plans to sideline Nigeria in their international travel routes.
The airline operators say the Nigerian market is no longer profitable and they are pulling out or suspending business operations.
Last month, Spanish airline Iberia announced an end to its operations in Nigeria, and the U.S. operators United Airlines plans to wind down its operations in the Houston-Lagos route by the end of June.
The Nigerian economy seems headed for a recession.
A slide in the price of crude oil in the international market has hit Nigeria with a sharp fall in revenues and a foreign exchange crisis.
The Nigerian market has become too unprofitable for airlines to operate in a year when the International Air Transport Association projects airline industry profits to witness a 12 percent increase, with the African region, in particular, to see a $200 million increase in profitability.
But in Nigeria, airlines say the acute shortage of foreign currency is to blame: the official exchange rate of the Naira is pegged at about N200 to $1.
And it has become increasingly difficult to source foreign exchange at the official rate; with most businesses at the mercy of the black market, currency traders sell at almost twice the official rate.
Last month, the Nigerian Senate invited the country’s finance minister and the Central Bank governor to brief them on new proposals to ease the nation’s economic crises.
Some independent experts have blamed the forex crises on President Muhammadu Buhari‘s hardline stance and blatant refusal to allow a floating exchange rate that reflects the true value of the Naira.
President Buhari’s government, though, has now yielded to the pressure somewhat, removing subsidies on petroleum products and setting the exchange at a more realistic rate of N290 to $1.
It remains to be seen how the measures, which some fear may be “too little too late,” would affect businesses in the country, in general, and airline operators, in particular.