Impact of COVID-19 on the Nigerian Economy
Quite topical is the theme of this essay, at a time when Nigeria and the rest of the world is faced with numerous challenges, occasioned by the novel Corona Virus Disease 2019 (COVID-19). The COVID-19 pandemic has posed grave threat and danger to the global economy, with experts positing that the pandemic has instigated an economic downturn, the likes of which the world has not experienced since the Great Depression of 1929. Economies have been warned by experts not to envisage any growth this year (2020), especially as unemployment is sky rocketing daily, economies contracting like never seen before, Gross Domestic Product (GDP) witnessing drastic falls, and to further worsen the situation for some countries (Nigeria as an example), a recent crash in oil price; amongst other sad economic events and realities. These events turnouts, all but underscored one striking fact – we are in for a really tough time, and no country will be spared.
It is important to identify the issues that pose as challenges to the Nigerian economy, and how these challenges will impact on the economy now and beyond. Quite incontrovertibly, – prior to the Covid-19 pandemic; the Nigerian economy certainly has areas of concerns to ponder on. First is unemployment. The phenomenon of unemployment has turned out to be a clog in the wheel of our economic progress. Recent reports from the National Bureau of Statistics (NBS) by the end of 2019 reflect high unemployment of 23.1%, with underemployment of 16.6%. The multiplier effect of unemployment includes a reduction in Gross Domestic Product (GDP), reduction in family income, debt burden increase, higher crime rates and even health challenges resulting from mental imbalance. The Covid-19 pandemic further made the situation worse, with companies already carrying out what is termed “downsizing” – in order to match up with the present realities of the competitive industry.
Worth recommending is a reasonable reduction in the pay of public office holders; after all, they were elected to serve the populace and not to milk them. By taking these steps, huge costs will be saved, and these funds can be better utilized on infrastructures, education, health and other pressing aspects of the economy.
In addition, the Nigerian economy has been hampered by varying issues. Particular mentions are hindrance to investment, infrastructural deficits, watery foreign exchange capacity, structural challenges, overdependence on oil as a means of generating revenue, e.t.c. All these underscored the present realities of the Nigerian economy; and the Covid-19 pandemic further made the situation appalling, particularly with the crash in oil prices. Adducing stronger pieces of fact, the poverty level observed in Nigeria is worthy of great concern. Oxfam, an international confederation of NGOs reported that 69% of the Nigerian population lives below the poverty line. With this recent Corona outbreak; wherein citizens are confined to stay at home, with little or no palliatives from the government, the Nigerian economy has no doubt, been thrown into a big mess of battling a twin pandemic- – hunger and health. It is unarguable and largely incontrovertible that we are in for a tough time as a country.
Indeed, it is considered needless to cry over spilt milk. Despite the obvious challenges and setbacks, the Nigerian economy is certain to bounce back, provided strategic measures and smart decisions are taken. First, poverty alleviation initiatives should be embraced by the government. This initiative could come in the form of empowering youths with the needed resources to engage in agriculture. Agricultural productivity will help reduce hunger and poverty, generate income for individuals and government (through exports), and more importantly, create employment. Soft loans can be facilitated by the government through the Central Bank, to help incentivize the target population. Investing in agriculture will especially help in retaining our pride as a nation and will create exports, which will help boost our foreign exchange capacity, thus giving our currency value.
Second, government must take the bold decision of slashing governance cost. The Nigerian governmental structures, coupled with the bi-cameral nature of our legislature need to be critically and holistically examined. Irrelevant and duplicative offices must be ostracized, to allow for diversion of funds into appropriate quarters. Worth recommending is a reasonable reduction in the pay of public office holders; after all, they were elected to serve the populace and not to milk them. By taking these steps, huge costs will be saved, and these funds can be better utilized on infrastructures, education, health and other pressing aspects of the economy. Third, the energy sector should be looked into; availability of constant electricity will help boost the economy in a lot of ways. Businesses will thrive, people will work conveniently from home, emissions from various engines would be reduced, and this will help sanitize the environment and prevent climate change. In the final analysis, migrating from what is presently obtainable to a buoyant and thriving economy requires taking brazen measures and steps. No doubt, some regulations or policies might seem tough to make and enforce; however, these steps must be taken in the best interest of Nigerians.
Oladimeji Idris SHOTUNDE is a first class graduate of the Lagos State University (Business Administration). He is the Founder of the largest academic group on campus, EXCEL MINDS Academic Group, with over 4000 members. Oladimeji is a “Fellow” of the United Nations Academic Impact Millennium Fellowship. He served as the Local Coordinator, African Students For Liberty (ASFL); served as Country Representative, Glocal International Teens Conference (GITC); Community Outreach Manager, SDGsACT LASU; amongst other engagements and social impact projects. He was a delegate at the 2018 NITIMUN Conference, held at Abuja, where he scooped the much coveted award of “Overall Outstanding Male Delegate”, as well as Outstanding Delegate on ECOSOC, AFDB, & UNODC Committee. He was thereafter appointed as a Conference Official for the 2019 edition of the conference, where he displayed excellence to emerge the “Best Conference Official”. Oladimeji Shotunde graduated as the “Best Graduating Student” (BGS) for the 2018/2019 Lagos State University Academic Session, with a record CGPA of 4.95. Oladimeji Shotunde was among the 50 student leaders, selected globally for the Hesselbein Leadership Summit/Global Academy, which was held at the University of Pittsburgh, Pennsylvania, United States of America. He has won numerous awards and gotten various recommendations.