THE EFFECT OF CORONA VIRUS (COVID-19) ON THE NIGERIA ECONOMY
The World Health Organization declared the coronavirus outbreak a global pandemic more than a year ago. COVID-19 has killed over 4 million people and infected over 200 million others worldwide.
The pandemic’s impact has been felt in nearly every aspect of modern life, upending public health systems, the global economy, travel, supply chains, community and social ties, and how we work.
According to International Monetary Fund (IMF) estimates, unemployment has increased and the global economy will contract by 4.4 percent in 2020. The vast majority of countries around the world entered recessions as a result of negative GDP growth.
Developing countries have suffered disproportionately as a result of the pandemic’s socioeconomic consequences. Wealthier nations can afford to impose the crippling lockdowns and restrictions that are sometimes required to stop the spread of the virus, as well as to support their populations so that they can stay at home in order to limit community spread.
Many developing countries, on the other hand, were frequently forced to rely on a jumble of truncated measures to limit the impact on populations already living in poverty or reliant on daily work for subsistence.
Furthermore, while wealthier countries can pre-order large quantities of vaccine candidates and ramp up inoculations to help their countries overcome the challenges of the pandemic, poorer countries must wait in line to vaccinate their populations, relying on mechanisms like COVAX that can only vaccinate a percentage of the population.
The pandemic had a disproportionate socioeconomic impact on Nigeria, which has one of the world’s highest rates of multidimensional poverty. The economy had already suffered from a rapid drop in oil prices in recent years, as well as security challenges resulting from insurgent violence and competition for resources,
and the fallout from the pandemic plunged the Nigerian economy back into a recession – the deepest in over four decades, with real GDP contracting for two consecutive quarters by 6.1 percent and 3.6 percent in Q2 and Q3 of 2020, respectively. However, the impact has been uneven across economic sectors, with some businesses feeling the negative economic effects more than others.
This aerial view, on the other hand, provides an aggregate of the overall increase in suffering, poverty, unemployment, and business closures caused by the public health crisis. It obscures the dynamics and developments that contribute to the overall picture.
To gain a better understanding of these effects at a granular level, UNDP has created a comprehensive database of the Nigerian business environment in collaboration with the National Bureau of Statistics, providing an unprecedented close-up of the situation in the country and a detailed assessment of the impact of the pandemic on businesses and business owners.
The survey results describe the consequences of the COVID-19 pandemic. Operations were disrupted across enterprises, with at least two-thirds of businesses currently operating in the country forced to close down during the pandemic.
The findings also shed light on government resistance to lockdown directives and regulation, particularly among informal enterprises, where one-third remained open throughout the pandemic. At the time of the survey, one out of every ten businesses was still closed.
However, it is likely that many businesses were unable to withstand the pandemic’s shock. As many as one in every three businesses interviewed said they were aware of a business similar to theirs that had permanently closed due to operational challenges caused by the pandemic
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THE EFFECT OF CORONA VIRUS (COVID-19) ON THE NIGERIA ECONOMY
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