Nigeria’s economy is heading to a new low as revenue from oil dips by 65% below this year’s budget projection. The bad news is coming close to the projection by the United Nations that the country and 23 others face imminent hunger in a few months from now.
According to the Minister of Finance, Budget and National Planning, Mrs. Zainab Ahmed on Sunday, the Coronavirus pandemic has impacted negatively on the economy leading to 65% decline in projected oil revenue in the first half of 2020.
She said it was anticipated that the situation will continue into the 3rd quarter, in spite of the measures put in place by the Federal government to contain the pandemic.
Mrs. Ahmed spoke at a Capacity Building program organized for Special Advisers and Technical Assistants to Ministers of the Federal Republic of Nigeria, in Abuja.
She said- “The impact of COVID 19 has seen Government taking several measures to address the crisis. Like other primarily oil-dependent economies, we have been hit hard by the drop in crude oil prices and the COVID 19 pandemic.
“Our economy faced serious challenges in the first half of 2020, seeing about 65% decline in projected net 2020 Government revenues from the oil and gas sector, with adverse consequences for foreign exchange inflows into the economy.
“We anticipate that these challenges will continue into the 3rd Quarter. The necessary implementation of a lock-down and social distancing measures led to a near complete shut-down of economic activities, lay-offs across most sectors, loss of income, and a drop in average household purchasing power,”
ALSC had on Tuesday reported that millions of Nigerians will in a few months from now, face acute food shortage and extreme hunger, according to a report published on Friday by two agencies of the United Nations Organisation.
The report has it that Nigeria and 24 other countries were “set to face devastating hunger in the coming months due to the fallout from the COVID-19 pandemic.”
According to the World Food Programme and the Food and Agriculture Organisation, in the report titled “Early Warning Analysis of Acute Food Security Hotspots,” the current decline in crude oil prices would also have far-reaching consequences on Nigeria to tackle the COVID-19 crisis and implement social safety net programmes.
It said that other vulnerable countries in Africa included Cameroon, Mali, Niger Republic, Sierra Leone, Liberia, Mozambique, Zimbabwe and Sudan while the others are in Asia and South America.
“The COVID-19 crisis is likely to have severe impacts on countries that rely on the export of commodities. In Nigeria, the COVID-19 pandemic is likely to deepen social and economic hardship, further exacerbating an already dire food and nutrition-insecurity situation. COVID-19’s rapid spread is putting additional strains on an economy already impacted by the fall in oil prices, further affecting government revenues and foreign currency reserves, and increasing depreciation of the local currency,” it stated.