US-Nigeria ‘Open Skies’ pact allows American carriers to charge fares in dollars

  • Nigeria’s second largest US export destination sub-Sahara Africa
  • Delta Airlines marks 15 years operations to Lagos

 

In what serves as an exemption to the rule, the ‘Open Skies’ agreement between Nigeria and the United States of America which has a clause on ticket sales rules allows American carriers to charge fares in whatever currencies they choose to.

Delta Airlines has taken advantage of that clause to offer fares in the United States dollars which has helped the carrier to sustain its operations in the country and particularly to stem the excruciating pain of accumulating more of its funds in the country; a situation that has seriously affected many foreign airlines operating to Nigeria.

It was learn’t that the carrier took the decision recently when its funds and that of other carriers that ran into over $400 million were trapped in the country.

Delta Airline

Speaking to Aviation Metric on Monday on the occasion to mark Delta Airlines 15 years of non-stop service to Nigeria, the carrier’s Sales Director for Africa, Middle East, and India, Mr. Jimmy Eichelgruen admitted that, “We collect in US dollars airfares out of Nigeria. That allows us to still operate as we have done for 15 years. So, we collect in dollars. If we issue a ticket in Nigeria, it is going to be paid for in US dollars”.

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“Yes, we are collecting in dollars at the present time. That allows us to operate normal frequencies. The interesting thing is, of course, we are still going with an extremely high load factor. We may review the situation as we go along”.

Corroborating Eichelgruen, General Sales Agent (GSA) for Delta Airlines, Mr. Femi Adefope said there is a unique agreement that exists between the US and Nigeria which is a variation of the Bilateral Air Service Agreement (BASA) called the ‘Open Skies’.

He further explained that under the Open Skies agreement, the official currency is the US dollar, adding that there is a clause in there that states that under extreme circumstances if Naira was a convertible currency; Nigeria could insist that they could pay Naira.

“Unfortunately, it is not a convertible currency. That does not apply to European carriers. It is a direct agreement between Nigeria and the US. Open Skies has been around. It is the same thing we had in UAE. Over the years, the UAE currency was not as strong”.

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Speaking on the remarkable 15 years of the airline service to Nigeria, the airline chief expressed satisfaction with it had done with the Nigerian route, describing it as lucrative and competitive.

“Our operation in Nigeria is run by Nigerians, for Nigerians as headed by a Nigerian. We know the market. That has been the journey that we have been on. It has been exciting. It has been 15 years of nonstop service. It speaks for itself. We are in this market because we are committed to the market. When we started out 15 years ago, we had identified even 15 years ago that Nigeria was a market we wanted to serve properly. We have been here for 15 years without a break. If you take the Nigerian market or the West Africa market in general, we restarted, open back services in Nigeria before we did Europe”.

“We have been successful in the market. We have done well. The bottom line is that when we started, we told Nigerian travelers that we are going to serve this market. We have kept our promises for 15 years. There is a great relationship between Nigeria and the USA. We have done well and we want to continue to serve the Nigerian people.

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Eichelgruen further disclosed that his airline considered one of the biggest airlines in the world had flown 1.65 million passengers in 15 years of its existence on Nigerian routes and airlifting 20, 000 tonnes of cargo within the same period.

“That tells you valuable airline Delta is flying between Lagos and the USA. The US is the largest foreign investor in Nigeria. The trade in 2019 stood at $3.2 billion. Nigeria is the second largest US export destination, in sub-Saharan Africa. It is the second-largest US export destination. In 2019, trade between the two countries totaled more than $10 billion”.

Wole Shadare