World Bank on Thursday, has said that the collapse in crude oil prices coupled with the COVID-19 pandemic has placed Nigeria’s economy in grave danger, stressing further that the situation will land the Nigerian economy into the greatest recession ever, since the 1980s”.
This coming in a new report by the World Bank, via a statement, titled ‘Nigeria in times of COVID-19: Laying foundations for a strong recovery,’ estimated that Nigeria’s economy would likely contract by 3.2 percent this year.
The statement as was stated by Shubham Chaudhuri the World Bank, Country Director for Nigeria states that the projection assumes that the spread of COVID-19 in Nigeria is contained by the third quarter of 2020,”.
However, the World Bank disclosed that the spread of the virus had become more severe, that the Nigerian economy could contract further if drastic measures are not taken.
Part of the World Bank report said, “Before COVID-19, the Nigerian economy was expected to grow by 2.1 % in this year 2020, in order words it means that the pandemic has led to a reduction in the growth of the Economy for more than five percentage points.
Parts of the report reads “The macroeconomic impact of the COVID-19 pandemic will likely be significant, even if Nigeria manages to contain the spread of the virus. Oil represents more than 80 percent of Nigeria’s exports, 30 percent of its banking-sector credit, and 50 percent of the overall government revenue”.
”With the drop in oil prices, government revenues are expected to fall from an already low eight percent of GDP in 2019 to a projected five percent in 2020.
Meanwhile, Mr. Shubham Chaudhuri had said: “While the long-term economic impact of the global pandemic is uncertain, the effectiveness of the government’s response is the merit to determine the speed, quality, and sustainability of Nigeria’s economic recovery.
“Besides immediate efforts to contain the spread of COVID-19 and stimulate the economy, it will be even more urgent to address bottlenecks that hinder the productivity of the economy and job creation.” he concluded.
Nwada Ugochinyere Onyechere reporting, Obinwannem News