In response to recent media reports that international airfares on Nigerian routes have skyrocketed due to an alleged increase in the IATA exchange rate, the International Air Transport Association (IATA) has issued a clarification stating that the exchange rate applied to international flight tickets sold in Nigeria is not determined by the association.
According to IATA, airfares for international flights from Nigeria are denominated in US Dollars and converted into Naira, the local currency, for sale in the Nigerian market. These conversions use the official prevailing exchange rate provided by the country’s financial system.
IATA explained that it simply applies the spot rate at which the Central Bank of Nigeria sells USD through banks to the market, at its fortnightly retail foreign exchange auctions. The rate is not static, meaning that if the rate at which the CBN sells USD goes up, the exchange rate applied to airfares will follow and vice versa.
It is incorrect to describe the exchange rate applied to international flight tickets in Nigeria as the “IATA exchange rate,” the association emphasized.
Nigeria is currently facing severe dollar shortages, which have forced many citizens and businesses to seek foreign exchange in the black market where the Naira currency has progressively weakened. This has made it difficult for some foreign airlines that sold tickets in the Nigerian Naira to get their money out of the country.
IATA’s clarification seeks to dispel any misconceptions about the association’s role in determining the exchange rate for international flight tickets in Nigeria. While the association plays a role in the airline industry, it does not have any influence on the exchange rates applied to flight tickets sold in Nigeria.
With this clarification, the association hopes to encourage more transparency and clarity in the discussion around the pricing of international flight tickets in Nigeria.
