Dollar Discounts Raise Eyebrows: Emirates’ Bold Move to Lure Passengers

Emirates Airlines’ recent move to price its tickets in dollars has ignited a fiery debate among aviation experts and travelers in Nigeria, raising concerns about the potential consequences on the country’s foreign exchange market and the value of the naira.

According to Susan Akporaiye, CEO of Topaz Travels and Tours, “The news that Emirates has opened bookings is supposed to be good news, but it’s not because it’s in dollars. This means people have to buy dollars on the black market, putting more pressure on the foreign exchange market, resulting in scarcity and fare increases. This could have a ripple effect on the entire economy, making it even more challenging for Nigerians to access affordable air travel.”

Olumide Ohunayo, an industry analyst, suggests that Emirates might be trying to configure its fares in naira or offering the cheapest fares in dollars. However, he notes that the airline’s previous withdrawal from the Nigerian market was due to issues with trapped funds and dollar-denominated payments to fuel suppliers. “Emirates needs to renegotiate these terms to ensure a smoother re-entry into the market,” Ohunayo emphasized.

The airline’s pricing strategy has raised concerns about its commitment to the Nigerian market and its willingness to work with local travel agents. Yinka Folami, president of NANTA, expressed worries about the exclusive nature of the UAE’s visa policy and the impact of dollar-denominated tickets on the naira. “As a Nigerian, I’m worried that Emirates is charging in dollars. Our legal tender is still the naira, and my personal experience is that if we keep denominating dollars in Nigeria, it will keep putting pressure on the naira.”

The debate highlights the complex issues surrounding foreign exchange, pricing strategies, and market dynamics in Nigeria’s aviation sector. As Emirates prepares to resume services to Nigeria, it remains to be seen how the airline will address these concerns and adapt to the local market. Will Emirates find a way to balance its business needs with the economic realities of the Nigerian market, or will its dollar-based pricing strategy be a major stumbling block? Only time will tell.

Source: businessday