A New Era for Nigerian Aviation: Overcoming Challenges and Embracing Opportunities
The turbulence that once surrounded foreign airlines’ trapped funds in Nigeria is now a thing of the past, according to Mr. Bankole Bernard, Group Managing Director of Finchglow Holdings Limited. Speaking during an interactive session with aviation correspondents in Lagos, Bernard shared insights into the evolving landscape of the Nigerian aviation industry as it moves from crisis to recovery.
The past year has been challenging for Nigeria's aviation sector, with millions of dollars belonging to foreign airlines still held up within the country. This predicament, which began in 2022, had serious repercussions, including the suspension of Emirates Airlines' operations for approximately 18 months. The airline halted its services in December 2022, citing $85 million of its revenue trapped in Nigeria. Overall, around $800 million in ticket sales for foreign airlines was stuck until the Federal Government took action in March 2024 to clear the backlog of debts. Bernard emphasized that the recent floating of the exchange market by the administration of President Bola Tinubu has transformed the financial environment for airlines.
He believes that such a crisis is unlikely to recur, stating, “The issue of trapped funds is behind us. We've learned that relying solely on the Central Bank of Nigeria (CBN) for foreign exchange is not sustainable. A free market is essential for growth.” This shift towards a more liberated exchange market has introduced much-needed stability for businesses, enabling them to adapt and thrive. Bernard pointed out that inflation had previously driven ticket prices up, leading to restricted inventories and operational challenges for airlines. However, he now sees a brighter future ahead. “With stability, we can plan for growth and navigate the future without the dilemmas of uncertainty,” he noted.
Despite these advancements, Bernard highlighted the necessity for Nigerian airlines to join the International Air Transport Association (IATA) Clearing House. He warned that airlines cannot simply operate on a point-to-point basis and expect to succeed. “The future of aviation lies in collaboration. Carriers must expand their inventories, engage in forex activities, and explore codeshare partnerships with international airlines,” he stated. Bernard's message is clear: to survive and flourish in today's competitive landscape, Nigerian airlines must embrace strategic partnerships and innovative practices. He urged local carriers to think beyond their immediate routes, as expanding their reach will be crucial for their growth in the evolving aviation market. As Nigeria’s aviation sector looks towards the future, the lessons learned from past challenges will serve as a foundation for a more resilient and collaborative industry. With the right strategies in place, the potential for growth and success in the Nigerian aviation market is more promising than ever.
