Nigeria's aviation sector closed out 2022 having navigated some of its most difficult financial pressures in years, even as the country notched a genuine infrastructure milestone with the opening of a new international terminal at its busiest airport.
Infrastructure Progress
The year began on a positive note in March, when President Muhammadu Buhari commissioned a new international terminal at Murtala Muhammed International Airport in Lagos, built with capacity for 14 million passengers annually. The terminal formed part of a wider programme that had also delivered new facilities at Abuja and Port Harcourt in prior years, with Kano's terminal following soon after.
A Year of Financial Shocks
That progress was quickly overshadowed by mounting financial pressure on the sector. In May, the Airline Operators of Nigeria announced a nationwide suspension of domestic flights after Jet A1 fuel prices nearly quadrupled in the wake of Russia's invasion of Ukraine, a shock the association said no airline could absorb without relief. Though flights resumed within days, the episode exposed how exposed Nigerian carriers remained to global fuel price volatility given the country's continued reliance on imported refined products.
In July, the Nigerian Civil Aviation Authority indefinitely suspended Dana Air's operating licences following a financial and safety audit that found the airline unable to meet its obligations or conduct safe operations, removing one of the country's established domestic carriers from service.
The most consequential blow came in August, when Emirates announced it would suspend all flights to Nigeria from September over its inability to repatriate an estimated $85 million in revenue trapped by the country's foreign exchange restrictions — part of a wider $450 million in funds international carriers said was being withheld across the industry. The departure of one of the world's largest airlines from the Nigerian market was widely seen as a stark signal of how currency policy was beginning to undermine the country's international air connectivity.
Looking to 2023
Industry stakeholders closed the year describing a sector pulled in two directions: genuine progress on physical infrastructure, set against a currency and cost environment that had pushed airlines, both domestic and foreign, to the brink. Whether the new Lagos terminal's promise could be realised depended, many argued, on resolving the deeper financial pressures that had defined the year.
