The coronavirus pandemic and falling oil prices have combined to force the Nigerian economy into negative growth, finance minister, Zainab Ahmed, has said.
Crude oil prices which were well above $50 before the pandemic have decelerated to less than $20, creating a huge revenue gaps for oil dependent nations like Nigeria.
Ahmed who spoke after the National Economic Summit meeting in Abuja on Thursday, admitted it would have huge impact on Nigerian revenues.
“On the economy, COVID-19 has resulted in the collapse in oil prices,” she said.
“This will impact negatively, and the impact has already started showing on the federation’s revenues and on the foreign exchange earnings.
“Net oil and gas revenue and influx to the federation account in the first quarter of 2020 amounted to N940.91billion. This represented a shortfall of N125. 52billion or 31% of the prorated amount that is supposed to have been realized by the end of that first quarter.”
She added that the economic contraction will multiply the misery of the poor.
“The crisis will only multiply this misery,” she said. “The economic growth in Nigeria, that is the GDP, could in the worst case scenario, contract by as much as –8.94% in 2020. But in the best case, which is the case we are working on, it could be a contraction of –4.4%, if there is no fiscal stimulus. But with the fiscal stimulus plan that we are working on, this contraction can be mitigated and we might end up with a negative –0.59%.”
