Nigeria slides into another recession as COVID-19 lockdown bites

The Nigerian economy is in another recession following consistent negative growth occasioned by the outbreak of the coronavirus pandemic and crash in oil prices.

Speaking at the recently concluded first virtual meeting of the National Economic Council (NEC) chaired by Vice President Yemi Osinbajo, Minister for Finance, Budget and National Planning, Zainab Ahmed, said that the ravaging coronavirus pandemic is not only affecting the country economically, but also affecting the health sector, as the resources to fight this appear inadequate.

She admitted that the crash in crude oil prices would negatively affect the country’s revenue and foreign exchange earnings.

This oil price crash and coronavirus pandemic outbreak has also affected the economic growth of the country and weakened the naira.

According to the Finance Minister, “Net oil and gas revenue input to the federation account in the first quarter of 2020 amounted to N940.91 billion. This represents a shortfall of N125.52 billion.

“But with the work that the Economic Sustainability Committee is doing bringing up a stimulus package, we believe that we can reduce the impact of that recession.”

Going further, Zainab Ahmed said, “And if we apply all that have been proposed and we are able to implement it we might end up with a recession that is -0.4%. But in any case, we will go into recession but what we are trying to do is to make sure that it is shallow so that we will quickly come out of it come 2021’’

Ahmed also disclosed that the economic growth in Nigeria could contract by as much as -8.94% in 2020 in the worst-case scenario. She also said that in the best-case scenario, it could be a contraction of -4.4%, if there was no stimulus and 0.59% contraction if there was a fiscal stimulus package.