The Economic Community of West African States (ECOWAS) may face significant hurdles in meeting its pledge to cut airfares as early as January 2026, BusinessDay's findings show.
While the regional body intends to incentivize the sector by eliminating air ticket taxes, the inherent complexity of aviation pricing – which involves various volatile cost drivers – jeopardizes the feasibility of this timeline.
The policy change was expressed by Chris Appiah, ECOWAS Director of Transport and Communications, during the recent ECOWAS Council of Ministers meeting in Abuja.
Also read: ECOWAS orders 25% cut in air transport charges from January 2026
Appiah said the directive, approved by the Authority of Heads of States and Governments in December 2024, is the culmination of years of technical analysis.
These studies confirmed a sobering reality: West Africa currently struggles with the highest airfares on the continent. This disparity is largely due to a number of government-imposed fees and aviation charges, which increase the cost of travel in the sub-region.
However, BusinessDay's findings show that removing the tax is only a partial solution.
Beyond regulatory fees, the ticket price structure is dictated by hefty insurance premiums that are often exacerbated by the fluctuating cost of aviation fuel and the frequent volatility of foreign exchange (FX) rates as well as perceived regional instability.
The Nigerian market is a vivid example of these pressures. Local airlines are currently burdened with insurance costs that are far higher than their counterparts in Ghana or South Africa.
Industry operators have indicated that Nigeria's classification as a high-risk environment, coupled with the huge premiums demanded by domestic underwriters, has fundamentally distorted the cost structure for local carriers.
BusinessDay found that while Nigerian airlines pay between eight per cent and 10 per cent of the value of an aircraft to insure it, airlines operating in Ghana, South Africa and other African countries pay two per cent to three per cent.
Additionally, the high cost of trucking aviation fuel (Jet A1) to airports significantly increases airline operating expenses, which directly increases air ticket prices for passengers, especially in areas like Nigeria where supply chain issues, foreign exchange rates and logistics make fuel expensive, accounting for up to 40 percent of airline costs.
Furthermore, international airfares on Nigerian routes continue to increase as a result of the high exchange rate in the country.
John Ojikutu, CEO of Centurion Aviation Security and Safety Consult, told BusinessDay that without a common currency and a strong regional intercontinental carrier, ECOWAS efforts will face limitations.
“My view of this ECOWAS intention is that it will be a difficult task for states that provide intervention funds or subsidies to government and private operators in their countries to maintain local operations, not to speak of additional international operations,” he explained.
Also read: ECOWAS to eliminate air ticket taxes from January 2026 to cut airfare costs
Seyi Adewale, CEO of Mainstream Cargo Limited, highlighted factors that can help reduce airfares, including higher load factors, efficient supply chains and targeted duty and tax exemptions.
“There are other important factors that can reduce 0.5 per cent, 1.0 per cent here and there such as the efficiency of the airline's supply chain, exchange rates, tariffs and tax exemptions. For example, the Federal Government completely waived four per cent FOB duty for commercial airlines, retained the zero per cent duty and Value Added Tax (VAT) exemption despite the new tax policy being significant,” Adewale explained.
Samuel Colchrick, former Rector of the Nigerian College of Aviation Technology, stressed that ECOWAS intervention would require legislative adjustments in Nigeria, such as reviewing charges such as ticket sales charge (TSC) and cargo sales charge (CSC). Access to low-cost capital for airlines, supported by strong corporate governance, is critical to the success of any regional airfare reduction initiative, he said.
