The minister of finance, Zainab Ahmed, has raised the fears of Nigeria going into another recession barely three years after it struggled of one.
Ahmed said that an assessment by the Nigeria Bureau of Statistics shows that the country’s economy will go into a recession at an average of -4.4 per cent.
She made this known while speaking with journalists after the National Economic Council meeting on Thursday.
“The National Bureau of Statistics (NBS) has made an assessment. So, it is the NBS assessment that Nigeria will go into a recession measuring at an average of -4.4%.
“But with the work that the Economic Accessibility Committee is doing bringing stimulus packages, we believe that we can reduce the impact of that recession.
“And if we applied all that have been proposed and we are able to implement it we may end up with a recession that is -0.4 per cent. 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,” the minister said.
Mrs Ahmed’s statement suggests Nigeria’s GDP would reduce for the first quarter of 2020 and reduce further for the second quarter, which will dovetail the country into an official recession. Nigeria’s GDP figure for the first quarter of 2020 is yet to be released.
Mrs Ahmed also spoke on why Nigeria was gradually re-opening its economy despite a daily rising coronavirus cases.
“This is a very difficult time because the challenges we have now are double. There is health challenge, there is an economic challenge. Even as we are addressing the current health challenge, we still have to look at how we can support the economy so that the economy does not fall into a depression.
“We have to feed the people and you can only feed the people if people go out and farm. We are a very large population, we don’t want to take the risk and we don’t have enough fund to cushion the effect,” she said.
Nigeria’s economy faces a severe impact from the coronavirus pandemic, being a mono-economy with a large chunk of its budget funded by oil revenue which accounts for over 90 per cent of its export. The sharp drop in oil prices globally has reduced income for the country.