Nigerians Can’t Afford A Second Lockdown, Yet Must Stay Alive
A resurgence of COVID-19 is lurking, as cases have begun to rise again. Nigeria contended with a lockdown to limit the spread of COVID-19 but a recession was the complication. The economy has been thrust deeply into a problem, as a result of the COVID-19 pandemic.
The National Bureau of Statistics announced a GDP contraction of -3.62% which beats the World Bank’s projections of 3.2% but still indicating a dire present. Other than the academic depictions of the NBS and the World Bank, the real-time effects of the pandemic and recession on Nigerians is heavy. Words on the street is that life is harder to come by for the Nigerian masses now.
Food, which is the baseline of most pursuits, has its prices skyrocketing. Nigeria’s current food inflation is one of the highest it has faced in recent years, no thanks to a planless border closure. Businesses have been affected badly, and the cost of living has spiralled high. Nigeria’s oil sector commands 8.5% of the country’s GDP and 90% of its foreign exchange earnings.
As the pandemic keeps biting deeply into pockets and petroleum prices facing fluctuatios everyday, Nigerians are about to face tougher times. The country’s inflation is spiralling high at 14.25% with food also facing a deep cost-push inflation.
Nigerians now buy petroleum at between N160-N170 and the cost of everything in the country is moving in tandem with the price of petroleum, which is the nation’s highest source of income and what the economy is driven on.
Services and the Informal Economy
The Nigerian services sector is driven by local remittances and at the point, it also faces struggles. The informal economy in Nigeria is one of the biggest in Africa and the world. It can be a real driver of the Nigerian economy but in the face of a second wave and lockdown, the sector faces real threat and the government has not shown enough support to this important sector.
Unemployment and underemployment in Nigeria are at very high proportions and it means there is an increased poverty rate in the country with over 82 million Nigerians expected to be in the poverty class.
A second wave of coronavirus means the economy will face tougher times but good government policies and a conscious attempt at economic recovery will ensure Nigerians live through the recession without pangs.
The Central Bank of Nigeria (CBN) has kept its MPC at 11.5% and more progressive decisions are expected in the coming days. Whether Nigerians face a lockdown or not, the government has a lot of work on its hands to save Nigerians from lack and hunger and this must start from opening the borders that have been locked for more than one year now.