Cost of air fares from Nigeria to various destinations is set to rise by over 50 percent as exchange rate for ticket pricing hits N770/$, BusinessDay’s findings show.
The development is coming few days after the Central Bank of Nigeria floated the naira and directed commercial banks to sell foreign exchange at market-determined rates.
The CBN said all forex windows should be collapsed into the Investors &Exporters Window.
Days after the decision, the exchange rate has since fluctuated on the International Air Transport Association (IATA) platform from 663.04/$ to N770/$.
Already air fares are increasing as a result of the increase in exchange rate.
BusinessDay’s findings show that Air fares for economy class tickets between Tuesday and Wednesday show a sharp rise by N200,000 to N250,000.
Experts say if the exchange rates continue to rise, an economy class tickets may rise from N1.2 million to as high as N1.8 million and above, while for the business class, the fares may rise from N4million to N6 million or more.
As at 2021, a dollar was being accessed at the official rate of N444 for one dollar by airlines. But it jumped to over N577 to a dollar in 2022.
“This is not the first time the exchange rate is going up. Since the president mentioned the devaluation of the naira in I and E window, the exchange on the IATA platform has not been stable.
“It has since fluctuated from N660/$ to N663/$, to N702/$ and today it is N770/$. The prices of tickets are determined by the I &E window not IATA,” Susan Akporiaye, the President of the National Association of Travel Agents of Nigeria, (NANTA) told BusinessDay.
Akporiaye explained that tickets are sold at the rate the I & E window closes for that day, which has since been determined by the deregulation of the naira and allowing the price to be determined by the I & E window.
“Tomorrow prices may drop. For now, the prices of tickets cannot be determined until point of purchasing the tickets. Anytime we are giving anyone any price, we emphasize that price is not valid until people are ready to buy. Just today prices of tickets have gone up by N250,000. The N770/$ is the highest the exchange rate has gone so far,” she said.