The International Air Transport Association (IATA) has denied setting an exchange rate for international flight tickets in Nigeria.
There have been reports that international airlines have increased their ticket price due to an increase in the exchange rate during the conversion of their proceeds.
It was reported that IATA was behind the increase which has led to international airlines applying a rate above the Central Bank of Nigeria’s (CBN) official price of N460/$1.
However, in a statement on Monday, the IATA said it doesn’t determine the rates used by foreign airlines, rather, the conversion rate used by the international airline operators is guided by the official market of the CBN.
IATA said it was wrong that the conversion rate is called the “IATA exchange rate”, stating that if the CBN rate rises, it is only normal for the exchange rate applied to airfares to increase.
“The exchange rate applied to international flight tickets sold in Nigeria are not determined by IATA and it is incorrect to describe them as the “IATA exchange rate”.
“Air fares for international flights from Nigeria are denominated in US Dollars and converted into Naira, the local currency, for sale in the Nigerian market.
“These conversions use the official prevailing exchange rate provided by the country’s financial system.
“IATA simply applies the spot rate at which the Central Bank of Nigeria sells USD through banks to the market, at its fortnightly retail foreign exchange auctions. The rate is not static, i.e. if the rate at which the CBN sells USD goes up, the exchange rate applied to airfares will follow and vice versa,” IATA said.
Join the conversation
Support Ripples Nigeria, hold up solutions journalism
Balanced, fearless journalism driven by data comes at huge financial costs.
As a media platform, we hold leadership accountable and will not trade the right to press freedom and free speech for a piece of cake.
If you like what we do, and are ready to uphold solutions journalism, kindly donate to the Ripples Nigeria cause.
Your support would help to ensure that citizens and institutions continue to have free access to credible and reliable information for societal development.