IMF projects negative GDP growth for Nigeria in 2020

As a result of the ongoing disruptions caused by the Coronavirus (COVID-19) pandemic, the International Monetary Fund (IMF) has predicted that the Nigerian economy will witness negative Gross Domestic Product (GDP) growth of -3.4 per cent in 2020, after growing 2.2 per cent in 2019.

The Chief Economist and Director of the Research Department, IMF, Gita Gopinath, said this during an online press conference on the latest World Economic Outlook (WEO) released Tuesday, at the ongoing virtual Spring Meetings of the IMF/World Bank in Washington DC.

The Bretton Wood’s Institution had in February reviewed its projected GDP for Nigeria from 2.5 per cent to 2 per cent in 2020. It initially attributed the forecast to the expected fall in revenue of the nation, which was connected to a fall in oil prices due to the outbreak of coronavirus, and the country’s inflation rate that is expected to rise.

Nigeria and other African governments imposed lockdowns and curfews to curb the spread of the coronavirus, but the restrictions are putting pressure on most economies — some of which were already in recession.

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.

According to Gopinath, sub-Saharan Africa was also projected to record negative GDP growth of -1.6 per cent, with GDP growth in the continent’s second-largest economy, South Africa, also expected to weaken to -5.8 per cent.

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.

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.

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