A new projection by the International Monetary Fund has revealed that Nigeria’s economy will recede by 3.4% in 2020 as a result of the COVID-19 pandemic which has disrupted global supply chains.
The interpretation of this is that the country is about to face its worst recession in 30 years, and the second recession in five years, following closely after a negative economic growth of 1.51% in 2016.
The report recalled that back in 1987, Nigeria’s economy receded by -10.87 and -0.6 in 1991.
The report was released today in Washington and was titled’ April 2020 World Economic Outlook report’
Gita Gopinath, IMF chief economist and director of the research department, said the recession to be experienced would be the worst since the Great Depression that occurred between 1929 and 1932 when the advanced economies shrunk by 16%.
It is projected that the Nigerian economy will rebound by 2.4% in 2021.
“For the first time since the Great Depression, both the advanced economies and emerging and developing economies are in a recession,” she said in a press briefing that marked the beginning of the April 2020 Spring meetings that is holding virtually.
“For 2020, growth in advanced economies is projected at -6%. Emerging markets and developing economies which typically have normal growth levels well above advanced economies are also projected to have negative growth of -1% and -2.2% if you exclude China.”
Gopinath also said the fund has projected 170 countries across the world would experience a shrinkage in their income per capita.
The economist said the recovery in 2020 would be partial and the projections provided in the report is the baseline scenario.