The impact of the dreaded COVID 19 on the Nigerian economy may force the economy to shrink by 5.4% in 2020, if data from the International Monetary fund, IMF, is to be believed. The Brenton woods institution had earlier said the Nigerian economy will shrink by 3.4%, but in a new data released Wednesday, the IMF revised the figures.
Nigeria has been reeling under the impact of COVID 19 on the economy, and that has been compounded by the oil price fall below production level, though it has slightly rebounded. Oil is the main foreign exchange earner.
The Finance minister had recently projected shrinkage of 8% in a worst-case scenario.
At the continental level, the fund said that the Gross Domestic Product (GDP) in Subsaharan Africa may shrink by 3.2 percent this year due to the impact of the COVID-19 pandemic. This was in contraindication to the previously estimated contraction of 1.6 percent by the Fund earlier this year.
South Africa, Africa’s most advanced economy, is expected to shrink by 8 percent in 2020, a bigger contraction than the 5.8 percent forecast in April, according to the bank.
With the lockdown that was imposed across Africa, production was at a low ebb, and the gradual easing off has many economies sluggishly picking up.
in Nigeria, the cost of foodstuffs has hit the roofs, with the inflation rising for the ninth straight month in May to 12.4%, the highest in two years.
