Cushioning The Effects Of Coronavirus On Nigerian Economy


This week, the price of crude oil nose-dived to $33 per barrel as a direct result of coronavirus effects, thereby raising fears of global economic down turn, particularly in Nigeria.

After almost two months since the outbreak of coronavirus disease on December 28, 2019, it has not only become a pandemic with heavy human fatalities but is taking a toll on global economy.

With many nations introducing emergency and contingency measures to check the spread of the disease, many flights are being cancelled therefore greatly reducing demand for fuel.

As a multiplier effect the short fall in demand triggered an in-house crisis between Saudi Arabia and Russia who have openly disagreed on whether to cut or increase daily output among members of the Oil Producing and Exporting Countries (OPEC).

This in turn brought about a crash in oil prices on Monday.
Definitely, the Nigerian economy will be the most hard hit since this year’s budget was predicated on oil benchmark of $57 per barrel.

The development has already thrown the budget into tatters and except the government takes proactive action, Nigeria may be in for another round of rough and tough times.

Already the Presidency has set up a committee involving the finance minister to work out modalities to sustain the economy in the face of the brewing global economic collapse.
Except the Federal Government takes quick and decisive measures to shore up the economy, we could witness a situation where the 2020 budget fails outrightly. Should that happen, it will have direct adverse impact on state budgets and their economy.

Having just come out of recession only a couple of years ago, it will be a big blow to experience another economic down turn.

As a nation whose economic mainstay is oil, Nigeria is bound to feel the ripples of the oil price crash in a painful way.

This therefore calls for the nation to diversify its economy away from oil. Nigeria should no longer continue to rely only on oil as its major revenue earner.

On the pandemic itself, Nigeria seems to be succeeding in preventing its spread in the country. So far, the cases of infection are limited to less than a dozen persons.

We are proud of how the Nigerian government handled the deadlier Ebola virus pandemic that ravaged the West African sub region in 2014. It is hoped that government and Nigerians will likewise rise to the present coronavirus pandemic with equal determination, faith and a sense of life preservation.

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Nigeria should be ready to confront and keep the disease at bay which is already causing economic and social dislocations in in many countries especially in China, Iran, Italy and still spreading.

In fact , the disease has taken a toll on the factors of production such that in the above mentioned places there is a lockdown affecting movement of people, shut-down of work places, cancellation of sport activities all of which have paralysed the society.

We pray the situation does not get to that in Nigeria, but we must be ready for any eventuality.

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