RCE:

Foreign exchange risk is now a major component of airfares on Nigerian routes, the country managers of top foreign airlines have revealed.

Investigations have revealed that the airlines operating on international routes in the country had increased airfares by as much as 100 per cent as a result of the development.

Foreign airlines are also stating that they may have no choice than to sack about 2,000 Nigerian Airline workers over their inability to source enough forex for their operations

A survey of all the major Nigerian routes flown by the foreign airlines in the country showed that the cost of return tickets had been increased by between 80 per cent and 120 per cent of the previous fares, depending on the carrier, time of booking and the season.

The survey cuts across Nigeria-North America routes, Nigeria-South Africa route, and Nigeria-Europe routes. Airfares on the Lagos-London, Abuja-London, Lagos-New York, Lagos-Atlanta, Lagos-Houston, and Lagos-Johannesburg routes were examined.

Findings also showed that local airlines operating international flights, especially Arik Air and MedView Airlines, had increased their airfares.

For instance, airfares on the Lagos-London and Abuja-London routes now cost an average of N380,000 for the economy class seat, as against the average of N200,000 a year ago on the British Airways and Virgin Atlantic Airways. This represents an increase of 111 per cent.

Similarly, on Air France, an economic ticket on the Lagos/Abuja-London routes now goes for about N360,000, while Lufthansa German Airlines charges N380,000. These represent an increase of 80 per cent and 90 per cent, respectively, when compared with an average fare of N200,000 on the routes a year ago.

A Business Class ticket now goes for as high as N3m as against the N1.5m a year ago on the Lagos-London route.

On the Lagos-Atlanta and Lagos-Houston routes, Delta Airlines and United Airlines, which used to fly Economy Class passengers for between N270,000 and N330,000 some 12 months ago, now render the same service at an average fare of N600,000, depending on the time of booking. This represents an increase of about 100 per cent.

South Africa Airways and Arik Air, which used to fly the Lagos-Johannesburg routes for between N100,000 and N120,000 for the economy class, now fly the route for between N180,000 and N220,000, depending on the time of booking and the season.

The Lagos-Paris route, which used to go for N180,000 on the average, now goes for around N400,000. This represents an increase of 120 per cent.

Operators link the increment in fares to the scarcity of foreign exchange to attend to the operational needs of the carriers and the erosion in the value of the ticket sales proceeds, which are now stuck in banks due to lack of forex to repatriate the funds.

Late last year, the new administration of President Muhammadu Buhari had unveiled a fiscal policy, through the Central Bank of Nigeria, restricting access to foreign exchange and funds transfer out of the country.

While this has had advantages for some sectors of the economy, foreign airline operators have complained of their inability to repatriate revenue to their operational bases as a result of the new policy.

An official of one the airlines told our correspondent that the carrier had close to N90bn as accumulated earnings in banks, which it had been unable to repatriate.

He said that the airline industry relied heavily on cash to meet its commitments, adding that it was sad that the government was not seeing things this way.

With huge airline revenue in the vaults of the banks, some of the operators nursed fears of being exposed to risks should the pressure on the naira lead to the devaluation of the currency, which could erode the value of the funds by about 35 per cent to 45 per cent.

Following the difficulty in repatriating earnings from Nigeria, some of the airlines initially began restricting cheap fares on the Nigerian routes in the last quarter of last year, leading to an indirect hike in fares.

At the time, the effect was felt more on second tier routes from Lagos-London-Atlanta, Lagos-London-New York, Lagos-London-Miami, Lagos-London-São Paulo, Lagos-London-Houston; or Lagos-Frankfurt-New York, Lagos-Frankfurt-Chicago, Lagos-Frankfurt-Los Angeles, and Lagos-Frankfurt-Shanghai.

Citing Nigeria’s slowing economy amid forex scarcity, some international airlines are now contemplating reducing flights to the country or operating smaller capacity aircraft as a short-term measure.

However, following complaints by the airlines, representatives of the International Air Transport Association are said to have pleaded with the CBN Governor, Godwin Emiefele, to intervene in the matter and make dollars available to them.

But the move has yet to yield any positive results.

The foreign airlines also reportedly met with the Minister of Transportation, Chibuike Amaechi, and urged him to look into their case.

A spokesperson for one of the airlines noted that the difficulty in repatriating revenues was affecting aircraft leases and fuelling, stating that the earnings were partly being used for fuel and renewing aircraft leases.

While the situation persists, the effect on air travellers and other businesses that depend so much on air travel has been immense.

A manager with a transport and logistic firm, Mr. Emmanuel Iruobe , said the company had incurred more costs than were provided for in the execution of most contracts this year.

Iruobe urged the government to look into the situation with a view to resolving it in the interest of Nigerians.

On their part, stakeholders in the travel industry under the aegis of the National Association of Nigeria Travel Agencies have faulted the astronomical cost of air tickets by the airlines, especially the foreign carriers.

Describing the situation where taxes that go to the airlines are higher than base fares as unacceptable, the group has petitioned the Federal Government, through the Ministry of Aviation, to caution the foreign airlines over the alleged sharp practices.

The Publicity Secretary, NANTA, Mrs. Ngozi Ngoka, opined that the cumulative effect of taxes and surcharges by airlines also generated a final price to the passenger that could be as much as double the advertised airfare for a short-haul flight.

Another stakeholder, who is the Chief Executive Officer, Gadshire Travels, Mr. Gbenga Adebayo, berated the airlines, describing the excuse of forex scarcity and multiple taxes given to increase fares as untenable.

According to him, the arbitrary increment and gap between what is charged in Nigeria and other African countries on the same routes are due to the failure of regulatory authorities to perform their duties.

Reacting to the development, the Central Bank of Nigeria has said that the seeming blackmail by foreign airlines over their demand for foreign exchange would not fly.

According to the CBN Governor, Godwin Emefiele, scarcity of forex is being professionally managed by the monetary authorities in such a way that priority is given to the sectors that drive growth in the economy, especially manufacturing industries which is public knowledge.

Also reacting to threats by foreign airlines to sack about 2,000 workers over their inability to source enough forex for their operations, CBN’s spokesman, Mr. Isaac Okoroafor, said the CBN had been selling forex to airlines through the Deposit Money Banks, DMBs, but that it should be recognised that there were other competing demands for the same forex from other sectors.

He said:  “That claim is not true.  CBN has been selling forex to the airlines through their banks. We are going through a period of forex scarcity. Part of our strategy has been  to identify key sectors and industries that will drive growth and curtail excessive forex demand. Airlines have been buying through their banks at the interbank rate.

“I am sure if you go through the published statements of sale by the banks, you will find this. What is not possible now, however, is for CBN to meet the   demand by some of these airlines. But look at the advertised their airfares.

SOURCE: shosilva.com

Nigerian Senate passes 2016 budget

The Senate has passed the N6.08 trillion budget for 2016, with an unprecedented reduction in the budget’s total.

President Muhammadu Buhari presented a N6.08 trillion proposal in December 2015.

The Senate passed N6,060,677,358,227 trillion budget after considering its conference report on the budget.

It was the first time since 1999 that the National Assembly would approve a figure lower than proposed by the executive, John Enoh, who heads the senate finance committee, said.

He said that reflected the “mood of the country and the world” and showed “discipline” of the part of the National Assembly.

Presenting a report on the budget, Danjuma Goje, Chairman senate committee on appropriation, said that the budget was “full of controversy”, but that the senate would not want to delay its passage by adding more controversies to it.

He said that there were lapses in the budget, but that the committee had to work around them. He said that the delay in the passage of the budget had already been given a political hue, hence Nigerians would blame the legislature for any further delay.

President Muhammadu Buhari presented a record N6.07 trillion budget in December but asked for its withdrawal a month later to make changes after a further drop in oil prices.

The total budget has not changed but the deficit has risen to 3 trillion naira ($15 billion) from 2.2 trillion.

The senate, based on the recommendation of the committee, adopted $38 per barrel crude oil benchmark for the budget, as proposed by the federal government. It also adopted a foreign exchange rate of N197 per dollar as proposed by the government.

The senate, however, reduced the total budget sum from N6.07trn to N6.06trn: N351bn for statutory transfers, N1.4trn for debt service, N2.6trn for recurrent expenditure, and N1.5trn as capital expenditure.

Also, the upper legislative chamber observed that the budget was not presented in time to the national assembly, which effected its passage.

It urged the federal government to submit the budget subsequently in strict compliance with the Fiscal Policy Act, and advised that there should be proper consultation between the budget office and the ministries, departments and agencies.

The senate also asked the government to diversify its revenue base, and to shore up capital expenditure and reduce recurrent expenditure.

Nigeria has held talks with the World Bank and has looked at borrowing from the African Development Bank and China Exim Bank to plug the budget gap as oil trades around $30 a barrel, down from over $100 in 2014.
SHORT BREAK DOWN OF 2016 BUDGET
Power, housing and works………. #433.4b
Transportation………………. ‪#‎202b‬
Interior……………… #53.1b
Special intervention programs………‪#‎300b‬
Defence…………. #137.6b
Education…….. #369.6b
Health…….#221.7b

SOURCE: Lensng

Brussels Terrorist Attack: Many Dead as Airport and Metro hit by explossions

Two explosions have hit Brussels' Zaventem airport, killing up to 13 people and injuring dozens, hospital sources told local media.

Shortly after the airport blasts on Tuesday morning, an explosion also struck the Maelbeek metro station in the centre of the Belgian capital, killing 15 people, Belgian media reported. The station is close to European Union institutions.

The Belgian federal prosecutor told state media the explosion at the airport was a suicide attack.

Footage from the airport - the country's largest - showed people running from the terminal building as plumes of smoke rose to the sky.

The powerful blasts caused parts of the ceiling to fall down and windows were shattered.

All metro lines were shut down after the attacks. Witnesses at the Maelbeek station said people with blood on their faces were seen at the scene. 

Ian McCafferty, a witness at the station, said the blast happened during busy rush hour traffic.

"People started running when they saw smoke coming," he said. "The point of these attacks is to make you live in fear, but I refuse to."

The interior ministry raised the country's terror alert to the highest level after the blasts and Brussels' crisis centre told people: "Stay where you are".

The interior minister said 600 additional police had been deployed.
Reuters news agency said shots were fired before the explosions at the airport. 

Local media reported the blasts happened near the American Airlines counter as hundreds of people were checking in.

"When I heard the first explosion, lots of people started screaming and running," Tom, an intern working at the airport, told Al Jazeera. "When I heard the second explosion, which was about 30 seconds after the first one, everything got chaotic. I could see panic on everyone’s face, blood on their bodies."

Police were clearing the area of stranded passengers, some in shock.

Belgian Prime Minister Charles Michel called for unity in a news conference.

"We are facing a difficult, challenging time and we should face up to this challenge by being united," he said.

“What we feared has happened, we were hit by blind attacks." 

The country had been on high alert since the arrest in Brussels last week of Salah Abdeslam, a key suspect in last November's Paris attacks that left 130 people dead. 

Belgium's Interior Minister Jan Jambon said on Monday the country was aware of the risk of a possible revenge attack following the capture of the 26-year-old.

"We know that stopping one cell can ... push others into action. We are aware of it in this case," he told public radio.

SOURCE: Aljazeera.com

Reps To Honour UNILAG 5.0 CGPA Graduate,Ayodele Daniel Dada

The House of Representatives is set to honour Ayodele Dada, the University of Lagos student who graduated from the Department of Psychology about two weeks ago with Cumulative Grade Points Average (CGPA) of 5.0.

Mr. Dada made history as the first graduate of a Nigerian University to record a perfect score – A’s throughout his course of study.

The House leader, Femi Gbajabiamila, in a letter dated March 21 and addressed to all the members, said that such recognition would celebrate the feat recorded by the student and serve to encourage other Nigerian students.

Gbajabiamila told members or the House of Representatives in the letter that such an achievement was the first in the history of Nigeria.

“I believe as leaders and as a country it’s time we start celebrating our successes particularly in a period of great national despondency that has enveloped us for years now.

“As a House I believe we should recognize, celebrate and commend Mr Ayodele so as to encourage him and give hope and inspiration to many others.

“To this end, I wish for you to join me as we suspend the House rules to invite Mr Ayodele Dada to the floor of the House on Tuesday 22nd March (today) to honour the young man and his remarkable achievement”, he said in the letter.
SOURCE: Naijatwitter

SAD omg!!! Nigerian Artiste, Nomoreloss is NO MORE.

Veteran artiste, "Nomoreloss", born Olumuyiwa Osinuga was confirmed dead on Monday, March 21 at an  undisclosed hospital in Opebi, Lagos state after battling an illness since January.

He's survived by a daughter and was just in his late 30s. 

After his death  was made known, Twitter was filled with condolences from people in the music industry, his fans and other sympathisers.

May his soul rest in peace, Amen.

#Nomoreloss,#Death,#illness,Artiste,#music,#ololufe,#Iyawoasiko, 

Nigerian Politicians Are The Most Difficult To Manage – Jega

Former INEC Chairman, Prof. Attahiru Jega, has described Nigerian politicians as the “most difficult to deal with in the world”.
Jega made the remarks at Chatham House in London yesterday in an interactive session after delivering a lecture titled: ‘Challenges of Modernising Election Processes: the Nigerian Experience’.

“When I was vice-chancellor, I thought students were the most difficult to deal with”, he said, but added that at INEC, he found out that politicians in Nigeria were the most difficult to relate with.
He said despite efforts aimed at “carrying the politicians along” by keeping them abreast with INEC activities and initiatives, the politicians would later turn round to reject what they approved or accused the commission of trying to favour rival parties if things were not going the way they wanted.
He said  both the former government and the National Assembly approved funds for smart card readers and permanent voters cards, among others, after being convinced of their necessity in ensuring credible elections, but when it dawned on them that they would not be able to manipulate elections as they did in the past, they strongly opposed the initiatives.
Describing Nigerian politicians as dogged and adept at pursuing their interests by “hook or crook”, Prof. Jega said the politicians could easily change tunes and cry foul when they realise that issues do not favour them or they could not manipulate them for their personal gains.
He attributed the huge success of the 2015 general elections to the adoption of technology in both the planning, management and conduct of the elections, and expressed optimism that “transparent and credible elections have come to stay in Nigeria”.
He listed funding, people’s suspicion of technology and aversion to changes by politicians, security of data, qualified manpower, among others, as some of the challenges of using technology in the conduct of transparent and acceptable elections.

SOURCE: nigerianmonitor

Oil Price Still Crashing Despite OPEC Seeking Higher Anchor Price

Oil prices are crashing again Tuesday after a short-lived spike on Monday. Crude oil fell by 1.19 percent by 7 a.m. GMT to around $37.50 a barrel, while Brent crude, the European benchmark, fell by 1.22% to hover just above $40 a barrel. If this price trend continues, it will eradicate the 3.5% gains that oil experienced on Monday.


Oil started to recover two weeks ago, with some analysts saying the commodity had finally bottomed out after a near-constant 18-month slide. Oil prices were in the triple digits in the summer of 2014 but are now about 60% lower because of a glut of oversupply by the OPEC cartel of oil-producing countries.


OPEC’s bid to push Western counterparts out of business seems to be working, with Juan Prada from Barclays writing in a note on Tuesday: “Data showed that active US oil rigs fell last week to the lowest level since December 2009. Sentiment was further supported by expectations of policy stimulus in China.”


But after initial concern that OPEC’s pledge to freeze its production wouldn’t make a difference — because of oil-rich countries such as Iran starting to pump huge amounts of oil — the oil price was given a boost by improving market sentiment.

OPEC also said it would be seeking a higher anchor price for oil. The slide in oil prices, however, supports some analysts’ view that the rally is and will be short-lived. Norbert Ruecker, the head of commodities research at the Swiss private bank Julius Baer, said this week that there would be no “long-term recovery” in the price of oil:

 Shale’s cost deflation, Iran’s return, and Mexico’s market opening suggest that supplies remain ample for longer, overshadowing the industry’s investment cuts for the time being. Supply glut fears have taken a backseat as of late with the oil market’s focus shifting from pessimism over ample inventories to optimism over declining US production. We still believe that oil prices experience a short-term bounce but no long-term recovery but see further upside in the near term.

SOURCE:nigeriamasterweb