Following the outbreak of the Coronavirus pandemic and its effect on the Nigerian economy, the Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed, has said that the country’s economy may go into recession if the pandemic persists for the next six months.
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Speaking during an appearance on a televised programme, the minister enumerated steps being taken by the President Buhari-led government curb the impact of the pandemic on the nation’s economy.
Mrs Ahmed stated: “We are hopeful that this pandemic will be limited in time. If it is an average of three months, we should be able to close the year with positive growth.
“But if it goes longer than that six months, one year, we will go into recession.”
The minister’s statement comes on the heels of projections by the International Monetary Fund, IMF, that the global economy has entered recession over the ravaging impact of the COVID-19 on different countries.
Calling on the International Monetary Fund and Financial Committee, the Managing Director, IMF, Kristalina Georgieva, in an opening remark during a conference, declared that no fewer than 80 countries had approached the Fund for help.
Georgieva stated: “We have reassessed the prospect for growth for 2020 and 2021. It is now clear that we have entered a recession – as bad as or worse than in 2009.
“We do project recovery in 2021 – in fact, there may be a sizeable rebound, but only if we succeed with containing the virus – everywhere – and prevent liquidity problems from becoming a solvency issue.
“A key concern about a long-lasting impact of the sudden stop of the world economy is the risk of a wave of bankruptcies and layoffs that not only can undermine the recovery but can erode the fabric of our societies.”
She added: “We have seen an extraordinary spike in requests for the IMF emergency financing – some 80 countries have placed requests and more are likely to come. Normally, we never have more than a handful of requests at the same time.”
On his part, the Managing Director, Afrinvest Securities Limited, Mr Ayodeji Ebo, reacting to the IMF chief’s submission on global recession and how it would affect Nigeria said: “If this COVID-19 persists for the next six months and oil prices remain below $30 per barrel, then Nigeria may be in a crisis.
