Nigeria sees economic slow down to persist till Q4
Nigeria expects the third and fourth quarters to reflect the continued effects of a slowdown, after the economy contracted by 6.1 percent in the second quarter, the presidency said on Wednesday.
“It is anticipated that while the third and fourth quarters will reflect continued effects of the slowdown, the fiscal and monetary policy initiatives being deployed by government in a phased process will be a robust response to the challenges posed by the COVID-19 pandemic,” said a statement signed by presidential spokesman, Femi Adesina.
“It is equally worth noting that since the start of the third quarter, the phased approach to easing the restrictions being implemented centrally and across States have resulted in a gradual return of economic activity, including the possibility of international travel.
“The government’s anticipation of the impending economic slowdown and the various initiatives introduced as early responses to cushion the economic and social effects of the pandemic, through the Economic Sustainability Programme (ESP), contributed immensely to dampening the severity of the pandemic on growth,” the presidential spokesman said.
“Furthermore, as the country begins the gradual loosening up of restrictions, and levels of commercial activity increase by people returning to their various livelihoods and payrolls expand, it still remains imperative that all the necessary public health safeguards are adhered to so the country avoids an emergence of a second wave.”
Nigeria, Africa’s largest economy and top oil producer, faces its worst crisis in four decades due to low crude prices, and the impact of the novel coronavirus pandemic, which hurt demand for its main export commodity.
Policymakers face a raft of challenges. Inflation rose to 12.82% in July, its highest level in more than two years, and the unemployment rate stood at 27.1% in the second quarter.
Nigeria’s economy was already grappling with sluggish growth before the pandemic following a 2016 recession. The International Monetary Fund has said it sees Nigeria’s GDP falling 5.4% this year, while the government has said the economy may shrink by as much as 8.9 percent.