IMF projects a recession for Nigeria in 2020

Nigeria’s gross domestic product is expected to contract 3.4% this year, compared 2.2% growth last year, as the coronavirus pandemic the great lockdown and associated sharp fall in international oil prices wreck the region’s economies, the International Monetary Fund said on Tuesday.

Nigeria governments have imposed another 14 days lockdowns in Lagos, Ogun and Abuja to curb the spread of the coronavirus, but the restrictions are putting pressure on the economy. The IMF also projected significant economic contractions in oil-exporting countries, with Nigeria’s GDP forecast to fall 3.4% this year after growing 2.2% in 2019.

Angola’s economy was expected to remain in recession, contracting 1.4% in 2020.

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The IMF and the World Bank – which has also projected a recession for sub-Saharan Africa in 2020 – are racing to provide emergency funds to African countries and others to combat the coronavirus and mitigate the impact of sweeping shutdowns aiming at curbing its spread.

The IMF said in its World Economic Outlook that GDP was projected to also fall sharply in South Africa, the continent’s most advanced economy. The country’s GDP is projected to contract 5.8% in 2020 from growth of 0.2% in 2019.

It will be recalled that South Africa entered a recession in the final quarter of last year as power cuts by state utility Eskom took a toll on the economy, while public finances were strained by bailouts to struggling state firms.

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The country imposed some of the toughest restrictions on the continent to contain the coronavirus, including a five-week lockdown to the end of April. With production and spending curtailed, the economic outlook was set to remain grim.

 

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