In a move set to enhance international air travel and restore strained diplomatic ties, Nigeria and the United Arab Emirates (UAE) have formally agreed to allow the sale of airline tickets and related services in foreign currencies, including the United States dollar.
The development comes as part of an updated Bilateral Air Services Agreement (BASA) between both countries, a document obtained by ireport247news.com has confirmed. The revised agreement marks a significant milestone in the resumption of Emirates Airlines’ operations in Nigeria, following a two-year suspension caused by a diplomatic and commercial dispute over trapped funds and regulatory limitations.
According to the agreement, airlines designated by either nation are now legally permitted to price and sell tickets in Nigerian naira or in any “freely convertible currency,” including the U.S. dollar, Euro, or British pound sterling.
“The designated airlines of each contracting party shall have the right to sell, and any person shall be free to purchase, such transportation and its ancillary products and facilities in local currency or in any other freely convertible currency,” the agreement states.
The UAE’s designated carriers include Emirates, Etihad Airways, Air Arabia, flydubai, Wizz Air Abu Dhabi, and Air Arabia Abu Dhabi. On Nigeria’s side, Air Peace and United Nigeria Airlines have been assigned as the official operators under the bilateral pact.
This decision not only unlocks a significant trade bottleneck but also improves the viability of international airline operations in Nigeria, where forex scarcity had previously led to the repatriation challenges and eventual service withdrawal by Emirates in 2022.
However, the policy shift has stirred concerns among Nigerian travel agencies. Agencies are now required to transact increasingly in foreign currencies while remitting large sums to the International Air Transport Association (IATA), further complicated by Nigeria’s existing $10,000 cash withdrawal and transfer limits.
“This development places us in a difficult position operationally,” said a Lagos-based travel agent who spoke under anonymity. “We’re dealing with high volumes of dollar transactions, yet local financial rules make it difficult to access or remit the funds smoothly.”
While Emirates is preparing to resume full flight schedules into Nigeria, the Nigerian-designated airlines—Air Peace and United Nigeria Airlines—have yet to commence reciprocal services to the UAE. Sources suggest that unresolved logistical and regulatory issues might be causing the delay, though neither airline has issued a public statement.
Meanwhile, the agreement also allows designated airlines to freely conduct their commercial operations, whether through direct channels or accredited agents. Airlines can also use their preferred transport documents, further easing procedural complexities in ticketing and operations.
The BASA also specifies that airlines may cover their local operational expenses in the host country using the domestic currency. However, payment in convertible currencies is permitted, provided it aligns with the host nation’s financial regulations.
“The designated airlines of one contracting party shall have the right to pay for local expenses in local currency or, provided that this is in accordance with local currency regulations, in any freely convertible currencies,” the document confirms.
Interestingly, Nigeria had already permitted certain U.S. carriers such as Delta and United Airlines to sell tickets in U.S. dollars under their respective bilateral aviation agreements. The new policy with the UAE essentially aligns the treatment of Middle Eastern airlines with that of North American operators.
The agreement also allows for future designation of additional UAE carriers, with Nigeria reaffirming its commitment to reciprocal aviation development and international cooperation.
This policy shift, analysts say, signals Nigeria’s growing flexibility in global aviation and its bid to attract foreign investment into the country’s aviation sector. It also offers a lifeline to foreign carriers whose funds were previously trapped in the country due to stringent forex controls.
With Emirates and other Gulf carriers poised to return, stakeholders expect heightened competition, improved service quality, and increased passenger capacity on the Nigeria-UAE route.
Still, the long-term impact of the agreement on local travel businesses, forex liquidity, and Nigeria’s aviation ecosystem will depend largely on the federal government’s ability to harmonise monetary regulations with the demands of an increasingly globalised airline market.