May 11, 2020

The COVID-19 pandemic with its attendant restriction on economic activities and severe impact on the oil market is set to reverse Nigeria’s growth of 2.3% achieved in 2019. There’s no gain saying that the economy of Africa’s most populous nation is heavily reliant on crude oil. Therefore, the Nigerian Economic Summit Group, updated its annual macro-economic outlook report to reflect the major shift due to the global pandemic. In report released in May, three scenarios were projected for the Nigerian economy in 2020. The projection factored in movement in crude oil price and volumes, government capital spending, the effect of the pandemic on non-oil sectors and other factors.

The lockdown of several states and the Federal Capital Territory (FCT) in the second quarter of the year 2020, will have an immense negative impact on GDP growth throughout the year. The three major GDP components – household consumption, government spending, private investment – were constrained during the lockdown effected due to the spread of coronavirus and are expected to perform poorly in full-year, relative to 2019. This is based on the high level of uncertainty over the pandemic as well as the fragility of the economy exemplified by the poor performance of major macroeconomic indicators.

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