COVID-19: Nigeria On the Brink of Severe Recession, according to World Bank
View pictures in App save up to 80% data. The World Bank has declared that, with the fall in the prices of oil, due to Coronavirus, currently ravaging the World, Nigerian economy is likely to be plunged into severe recession, the worst to be experienced since the 1980s.
It further said that, if the spread of the virus continues, the Nigerian economy could contract further. Before the outbreak of Coronavirus, the economy was expected to grow by 2.1 per cent in 2020.
This indicates that, the outbreak of the disease, has brought about reduction in growth, by more than five percentage points.
The macroeconomic impact of the disease, will likely be significant, even if the country is able to contain the virus.
Oil is the major source of income to the government, representing more than 80 percent of its exports, 30 percent of its banking sector credit, and also 50 percent of its revenue.
With the drop in the prices of oil around the globe, it's revenues are expected to reduce from an already low eight percent of GDP in 2019, to a projected five percent in 2020.
This is coming at a time, when resources are immediately required to contain the disease outbreak, and therefore stimulate the economy.
According to the statement, Shubham Chaudhuri, World Bank Country Director for Nigeria, also said that, this will hinder economic productivity thereby affecting the creation of jobs in the country. This will eventually make Nigerians poorer.
The disease which is currently ravaging the World, has affected the economic growth, in most nations around the globe.
It has led many countries shutting down productive sectors of the economy. It is hopeful that as soon as possible, researchers will be able to develop a drug or vaccine to curtail the virus.