Flights to Dubai are expected to resume by December as the federal government has cleared part of the trapped funds for Emirates and Etihad Airlines, BusinessDay’s findings have shown.
A source familiar with the matter revealed to BusinessDay Wednesday at the sidelines of the Dubai Business Forum at Madinat Jumeirah.
The Dubai Business Forum, a transformative global event powered by Dubai Chambers, commenced on Wednesday with insightful discussions on the future of globalisation and foreign direct investment.
Hosted under the patronage of His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai, the forum welcomed a stellar lineup of distinguished guest speakers.
According to the source, trapped funds of Etihad and Emirates are being repaid and have reduced from $85million, which belongs to Emirates to $12 million, though at a loss as the naira has weakened to the dollar (N489/$ then to 789/$ today) since the airlines suspended operations.
BusinessDay’s findings show that repatriation of trapped funds is tied to the lifting of the visa ban and agreements are likely to be finalized during COP28 billed for Dubai in December.
In October 2022, the United Arab Emirates (UAE) immigration authorities announced a ban on visa applications from Nigerians.
Read also: Airlines lose N26bn on Dubai flights ban
One month later, Emirates suspended flight operations to Nigeria — for the second time in the year – over its inability to repatriate its $85 million revenue trapped in the country.
A few weeks ago, Nigerians celebrated when the Federal Government said talks were at the very top level to lift the visa ban on Nigerians and ensure direct flights resume to the United Arab Emirates (UAE).
Festus Keyamo, Minister of Aviation and Aerospace Development September said the federal government is working out details on the resumption of flights from Nigeria to the UAE.
However, since the announcement by the federal government, Nigerians have continued to await flight resumption and the visa ban tactically placed on Nigerians from travelling to Dubai.
According to travel agents, Nigerians love to travel Dubai. The Emirati city, known for its malls, luxury shops and iconic buildings, continues to be one of the top destinations visited by Nigerians for summer, holidays, medical and recreational tourism and to see family and friends.
“While the visa ban continues, a few Nigerians still get visas to Dubai especially those travelling for business purpose or those attending conferences for few days. The visa ban really affects those travelling for vacation or tourist and these constitute over 80 percent of travellers to Dubia,” Gina Chika, a travel consultant told BusinessDay.
She said once the visa ban is lifted, Nigerians would be happy to again get on the flights to Dubia, adding that the few people being granted visas to UAE have to pay more to not only connect flights but face challenges accessing visas and yellow cards to countries to pass through connecting routes.
UAE is also asking for the removal of double taxation, eg Emirates and other UAE businesses won’t pay tax in Nigeria.
Sources who spoke to BusinessDay are worried Nigeria the Bilateral Air Service Agreements (BASA) isn’t strong enough to remove double taxation — Emirates does 21 flights compared to two weekly flights operated by AirPeace.
Olumide Ohunayo industry analyst and Director of research, at Zenith Travels, told BusinessDay that the International Air Transport Association (IATA) said Lagos and Abuja are the most expensive airports in Africa and this is because of taxes and charges charged by the government and airport authorities.
Ohunayo said after the remarks by IATA few months ago, he expected that the federal government would set up a committee to address the issue but nothing has been done since then.
He said if the foreign airlines are complaining, then it is worse for Nigerian carriers and he was not surprised the airlines were making the demands.
Dubai-based businesses, from shops that sell garri, semovita and kponmo to restaurants are shutting down as the influx of Nigerians dries up.
Village Chief — a popular Abuja-based restaurant set up in Dubai just after the visa ban — is now operating at a loss and being kept afloat with support from the Nigerian branch, Businessday gathered.
The restaurant had ventured into the Arab state, hoping the impasse would be over swiftly. Currently, Village Chief is unable to bring its chefs to make its famous grilled catfish to cater for Nigerians in Dubai.
Last year, many Nigerians who often buy high volumes of luxury goods such as gold, assorted jewelleries, wristwatches, clothes, fabrics, shoes, hair extensions, other accessories and electronics during festive season sought other destinations to shop for Christmas and New Year and enjoy tourist attractions.
“Business is a little slow this period for me. I used to have a lot of customers from Nigeria who come here during the festive season to buy from me. They haven’t been coming because of the visa ban,” Amin, the sales director at Atlantis Trading, which deals in human hair extensions in Dubai told BusinessDay on phone.
He said Nigerians’ patronage were always critical to his revenue during the festive seasons, but sales have dropped this year.
Nigerians who travel with their foodstuff are finding it difficult to buy goods they are used to at home. Supermarkets that sell these foodstuff and other products say they are going under and are unable to cope beyond December.
The source confirmed that when President Bola Tinubu met with Sheikh Mohammed bin Rashid Al Maktoum over a month ago there was an agreement in principle to resolve the visa ban and repatriation of airlines’ trapped funds. However, Ajuri Ngelale, the media aide of President Tinubu announced that the ban would be lifted and flights would resume immediately.
Emirates and UAE government frowned at FG’s decision to go to press to make the premature announcement.
BusinessDay reported lately that a delegation from Abu Dhabi came to Nigeria for a meeting with the presidency in Abuja. They met with Nuhu Ribadu, National Security Adviser, during the two days of meetings.