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COVID-19: Best and worst case scenarios for the Nigerian economy

The worst-case scenario is if the world does not find a vaccine in the next fifteen months.



Q1 2020 National Debt report

A series of unfortunate developments have been working together to shape the Nigerian economy, albeit in a bad way. And things could get worse, unless certain actions are quickly taken to mitigate these unfavourable incidents.

This is the summary of a presentation by Cheta Nwanze, the Lead Partner at SBM Intelligence, who was part of a set of vibrant panelists that spoke during Nairametrics’ second-quarter 2020 economic outlook. The event, which took place virtually on Saturday, was centered on the topic: “The New Normal – Economic Outlook: Your Money or your Life.”


According to Nwanze, the COVID-19 pandemic triggered a public health crisis in Nigeria, a situation that was quickly followed by economic instability. The drastic drop in oil price, Nigeria’s major source of foreign exchange, only complicated the situation.

READ ALSO: Experts outline what SMEs must do to attract fund, investors in 2020 

While other countries like the US responded to the crisis by doling out trillions of dollars as palliatives, Nigeria offered very little relief. The country was also further plagued by a worsening inflation rate and civil unrest/security challenges. The International Monetary Fund (IMF) had since predicted a global recession, expected to exceed 3%.

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Nigeria was not prepared to handle COVID-19 and its fallouts

Speaking further during his presentation, Nwanze compared Nigeria’s response to the pandemic with countries such as South Africa and India. According to him, Nigeria’s initial COVID-19 curve was particularly similar to India’s.

But this changed over time because Nigeria had only been able to test a very limited number of its citizens, a situation that led to fewer cases being discovered. That was unlike India which ramped up its testing efforts. Notwithstanding, the negative economic effects of the pandemic had continued to be very pronounced in Africa’s most populous country.

“However, the economic effect is still there, whether the cases are low or not. And it shows the state’s preparedness; this chart is very important…the preparedness of the Nigerian state. Basically, this chart was derived by taking certain factors into consideration – doctor to population ratio, human development index, infant mortality, per capita budget, percentage of budget spent on health; that’s a very important thing which many people don’t look at in this country.

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“After looking at all these, you find that the best prepared Nigerian state is supposed to be Cross River which is not even up to 60% ready for anything. Basically, Nigeria on a state level is not ready to handle the effect of this pandemic.”

READ MORE: Fending off Recession in Nigeria: Experts Offer some Advice to Presidency

Civil unrest and violence have been major problems

In addition to the fatalities caused by the COVID-19 pandemic and an earlier Lassa fever outbreak in the year, Nigeria has also been grappling with the fatalities caused by unrest in the country’s North-Eastern region.

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According to Nwanze, hundreds of violent deaths were reported across North-Eastern Nigeria. In the same vein, kidnapping remained a major security challenge in the country, he noted. Unfortunately, a bad security situation never facilitates the economy of any country.

Focus on Nigeria’s inflation problem

Moving on, Nwanze noted that Nigeria’s inflation had gone up to an all-time high. In reaction to that, interest rates had gone down, just as capital importation was down. In the same vein, the exchange rate and the country’s external reserves down were also down. One of the implications of all that was the fact that Nigeria’s federal allocations were increasingly becoming smaller. He explained the impact of that in the quote below:

“Looking at the chart, what immediately jumps out is that on the average, FAAC allocations are getting smaller. There’s a session that we had a higher share in March of 2020. But what people need to bear in mind is that these figures you are looking at are naira figures.


“And there was a devaluation in between February and March. So, because of that devaluation, the March figures appear to be higher. But if you convert everything to USD at the prevailing rates of such sharing, you will find that the money is actually consistently getting smaller.

“This again has implications in terms of social unrest, security, and the larger economy. States don’t have as much money. It means that some states will just go straight up and owe staff. Some states will downsize, and the bottom line is that the unemployment market is going to get much larger.”


READ ALSO: COVID-19: Short-term reforms needed to reduce impacts on the Nigerian economy -NESG

FAAC allocations

Global recession to hit hard

He also spoke a bit more extensively about the global recession that was forecast by the IMF. He noted that the 2020 recession is expected to have a far greater negative impact than the 2008 global economic crunch as well as the 2016 recession. Similarly, the World Trade Organisation had predicted that global trade would decline by 32%. Again, that will be worse than what was experienced during the 2008 global financial crisis.

Back home in Nigeria, the recession is expected to impact on people’s spending habits. He noted that research had shown that Nigerians typically spend more than 50% of their incomes on food. The nature of the situation is such that the lesser one’s income, the more likely they are to spend more on food than anything else. The implication, therefore, is that people would normally not have enough money for other important things such as investments. And that is not good for the economy.

Sectors that will be most affected

As the global recession looms, sectors of the Nigerian economy that are expected to be hit the hardest are: the banking industry, construction, travel and leisure, entertainment, automotive, luxury goods, oil and gas, trade, and transportation. He noted that those sectors were all major employers of labour in Nigeria.

Speaking further, Nwanze stressed that Nigeria needed to come up with serious actions that would help mitigate the effects of the pandemic. He also examined the best-case scenario and the worst-case scenario.

Best and worst-case scenarios

The best-case scenario which, according to him had the lowest probability, would be if the world finds a vaccine within the next three to six months. This would allow Nigerians to fully resume back to work. A possible vaccine discovery would also help oil prices to rebound, a situation that would be favourable to the GDP and economy at large.

The worst-case scenario, on the other hand, would be if the world does not find a vaccine in the next 15 months. If that happened, infection rates would most likely spike and the government might have to adopt more drastic lockdown measures in a bid to contain the virus. This would be bad for the economy, he stated.


Emmanuel covers the financial services sector for Nairametrics. Do you have a scoop for him? Well then, contact him via his email- [email protected]



  1. Oyetunji Kuforiji

    May 19, 2020 at 11:13 am

    Based on the current reality, there’s need to look at remittances from Diaspora which has been the largest contributor to the economy since 2015. Is it capable of bailing the economy by stimulating the aggregate demand? I sincerely believe so. Consequently income tax will be placed in a good position in shaping the fiscal policy.

  2. Ifeanyi Ekwegbalu

    May 20, 2020 at 6:49 am

    It’s obvious we ain’t getting the vaccine so soon but then Govt. should help in the following ways.
    1. Review downwards or put a hold on income tax so as to increase spending limit of salary earners.
    2. Tax incentives for our importers which will reduce cost of goods marginally.
    3. CBN intervention in FX supply and demand.
    4. Fiscal and monetary policies that will reduce inflation rate.

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COVID-19 Update in Nigeria

On the 12th of July 2020, 571 new confirmed cases and 16 deaths were recorded in Nigeria.



The spread of novel Corona Virus Disease (COVID-19) in Nigeria continues to record significant increase as the latest statistics provided by the Nigeria Centre for Disease Control reveal Nigeria now has 32,558 confirmed cases.

On the 12th of July 2020, 571 new confirmed cases and 16 deaths were recorded in Nigeria, having carried out a total daily test of 2,973 samples across the country.


To date, 32,558 cases have been confirmed, 13,447 cases have been discharged and 740 deaths have been recorded in 36 states and the Federal Capital Territory. A total of 181,248 tests have been carried out as of July 12th, 2020 compared to 178,265 tests a day earlier.

COVID-19 Case Updates- 12th July 2020,

  • Total Number of Cases – 32,558
  • Total Number Discharged – 13,447
  • Total Deaths – 740
  • Total Tests Carried out – 1781,248

According to the NCDC, the 571 new cases were reported from 20 states- Lagos (152), Ebonyi (108), Edo (53), Ondo (46), FCT (38), Oyo (20), Kwara (19), Plateau (17), Osun (14), Bayelsa (14), Ekiti (14), Katsina (14), Akwa Ibom (11), Kaduna (11), Rivers (11), Niger (10), Ogun (7), Kano (6), Cross River (4), Bauchi (2).

Meanwhile, the latest numbers bring Lagos state total confirmed cases to 12,427, followed by Abuja (2,576), Edo (1,731). Oyo (1,726), RIvers (1,368),  Delta (1,359), Kano (1,309), Ogun (1,087),  Kaduna (989), Ondo (716), Katsina (669), Ebonyi (616), Borno (586), Plateau (533), Gombe (530), Bauchi (521), Enugu (476), Abia (405),  Imo (386), Kwara (330).

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Jigawa state has recorded 321 cases, Bayelsa (313), Osun (245), Nasarawa (244), Sokoto (153), Akwa Ibom and Niger (135),  Benue (121), Adamawa (110), Anambra (93), Kebbi (86), Zamfara (76), Ekiti (63), Yobe (62), Taraba (27), Cross River (9) while Kogi state has recorded 5 cases only.


READ ALSO: COVID-19: Western diplomats warn of disease explosion, poor handling by government

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Lock Down and Curfew

In a move to combat the spread of the pandemic disease, President Muhammadu Buhari directed the cessation of all movements in Lagos and the FCT for an initial period of 14 days, which took effect from 11 pm on Monday, 30th March 2020.

The movement restriction, which was extended by another two-weeks period, has been partially put on hold with some businesses commencing operations from May 4. On April 27th, 2020, Nigeria’s President, Muhammadu Buhari declared an overnight curfew from 8 pm to 6 am across the country, as part of new measures to contain the spread of the COVID-19. This comes along with the phased and gradual easing of lockdown measures in FCT, Lagos, and Ogun States, which took effect from Saturday, 2nd May 2020, at 9 am.

On Monday, 29th June 2020 the federal government extended the second phase of the eased lockdown by 4 weeks and approved interstate movement outside curfew hours with effect from July 1, 2020.

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READ ALSO: Bill Gates says Trump’s WHO funding suspension is dangerous

DateConfirmed caseNew casesTotal deathsNew deathsTotal recoveryActive casesCritical cases
July 12, 2020325585717401613447183717
July 11, 2020319876647241513103181607
July 10, 2020313235757092012795178197
July 9, 202030748499689512546175137
July 8, 2020302494606841512373171927
July 7, 2020297895036691512108170127
July 6, 202029286575654911828168047
July 5, 2020287115446451111665164017
July 4, 202028167603634611462160717
July 3, 2020275644546281211069158677
July 2, 2020271106266161310801156937
July 1, 2020264847906031310152157297
June 30, 202025694561590179746153587
June 29, 20202513356657389402151587
June 28, 20202486749056579007149957
June 27, 20202407777955848625148947
June 26, 20202329868455458253144917
June 25, 20202261459454977822142437
June 24, 20202202064954297613138657
June 23, 20202137145253387338135007
June 22, 20202091967552577109132857
June 21, 202020242436518126879128477
June 20, 202019808661506196718125847
June 19, 202019147667487126581120797
June 18, 20201848074547566307116987
June 17, 202017735587469145967112997
June 16, 202017148490455315623110707
June 15, 20201665857342445349108857
June 14, 202016085403420135220104457
June 13, 20201568250140785101101747
June 12, 20201518162739912489198917
June 11, 2020145546813875449496737
June 10, 20201387340938217435191407
June 9, 2020134646633654420688937
June 8, 2020128013153617404084007
June 7, 20201248626035412395981737
June 6, 2020122333893429382680657
June 5, 20201184432833310369678157
June 4, 2020115163503238353576467
June 3, 2020111663483151332975227
June 2, 20201081924131415323972667
June 1, 20201057841629912312271579
May 31, 20201016230728714300768687
May 30, 2020985555327312285667267
May 29, 202093023872612269763447
May 28, 202089151822595259260647
May 27, 202087333892545250159787
May 26, 2020834427624916238557107
May 25, 202080682292337231155247
May 24, 202078393132265226353607
May 23, 202075262652210217451317
May 22, 2020726124522110200750337
May 21, 2020701633921111190748987
May 20, 202066772842008184046377
May 19, 202064012261921173444757
May 18, 202061752161919164443407
May 17, 202059593881826159441837
May 16, 202056211761765147239737
May 15, 202054452881713132039544
May 14, 202051621931683118038154
May 13, 202049711841646107037374
May 12, 20204787146158695936704
May 11, 202046412421521090235894
May 10, 202043992481421777834794
May 9, 202041512391271174532784
May 8, 202039123861181067931154
May 7, 20203526381108460128184
May 6, 20203145195104553425071
May 5, 2020295014899548123704
May 4, 2020280224594641722912
May 3, 2020255817088240020702
May 2, 20202388220861735119522
May 1, 20202170238691035117512
April 30, 2020193220459731715562
April 29, 2020172819652730713692
April 28, 2020153219545425512322
April 27, 20201337644102559942
April 26, 20201273914152399942
April 25, 20201182873632229252
April 24, 202010951143312088552
April 23, 20209811083231977532
April 22, 2020873912931976482
April 21, 20207821172631975602
April 20, 2020665382311884662
April 19, 2020627862221704362
April 18, 2020541482021663562
April 17, 2020493511841593172
April 16, 2020442351311522772
April 15, 2020407341211282672
April 14, 202037330111992632
April 13, 202034320100912422
April 12, 20203235100852282
April 11, 202031813103702382
April 10, 20203051770582402
April 9, 20202881471512302
April 8, 20202742260442262
April 7, 20202541661442042
April 6, 2020238650351982
April 5, 20202321851331942
April 4, 2020214540251850
April 3, 20202092542251800
April 2, 20201841020201620
April 1, 2020174352091630
March 31, 202013982091280
March 30, 2020131202181210
March 29, 2020111221031070
March 28, 20208919103850
March 27, 2020705103660
March 26, 20206514102620
March 25, 2020517102480
March 24, 2020444102410
March 23, 20204010112370
March 22, 2020308002280
March 21, 20202210001210
March 20, 2020124001110
March 19, 20208000170
March 18, 20208500170
March 17, 20203100030
March 16, 20202000020
March 15, 20202000020
March 14, 20202000020
March 13, 20202000020
March 12, 20202000020
March 11, 20202000020
March 10, 20202000020
March 9, 20202100020
March 8, 20201000010
March 7, 20201000010
March 6, 20201000010
March 5, 20201000010
March 4, 20201000010
March 3, 20201000010
March 2, 20201000010
March 1, 20201000010
February 29, 20201000010
February 28, 20201100010

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Evacuation: 247 Nigerians arrive home from Malaysia, Thailand 

The returnees were evacuated with a chartered Air Peace flight APK-7813.



Evacuation: 247 Nigerians arrive home from Malaysia, Thailand 

The Federal Government of Nigeria has safely evacuated and returned home, two hundred and forty-seven Nigerians who were stranded in Malaysia and Thailand 

The returnees were evacuated with a chartered Air Peace flight APK-7813 which arrived the Nnamdi Azikiwe International Airport, Abuja at about 11p.m. on Saturday. 


According to Mr Gabriel Odu, the Head of Media and Public Relations Unit of the Nigerians in Diaspora Commission (NiDCOM) who spoke to NAN, some of the returnees disembarked in Abuja, while the others proceeded to Murtala Muhammed International Airport, Lagos. 

READ ALSO: Nigerians willing to travel abroad will wait a bit longer – Aviation Ministry

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In line with the protocols announced by the Presidential Task Force on COVID-19, all of the returnees presented a negative COVID-19 test result before boarding the evacuation flight, and upon arriving Nigeria, are expected to proceed on a 14-day self-isolation 

Since four weeks ago, from the federal government, through the ministry of Foreign Affairs announced the resumption of evacuation flights, hundreds of stranded Nigerians have been returned home to their families from different countries including the United States of America, United Kingdom, Egypt, Malaysia and Thailand.  

READ ALSO: COVID-19 could impoverish additional 5 million Nigerians – World Bank  

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The returnees bear the cost of their flight tickets and are expected to self-isolate for four weeks, upon their return to Nigeria. Returnees who receive a clean bill of health after the isolation, are given their passports and allowed to go home.  

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Port-Harcourt International airport resumes flight operations

The first flight to Port Harcourt was conducted by Air Peace 5N EUV from Lagos.



FAAN reacts to release of guideline for resumption of flight operations post covid-19, FAAN releases new guidelines for post covid-19 flight operations

The Port Harcourt International Airport formally resumed flight operations on Saturday, July 11, with the Federal Airports Authority of Nigeria (FAAN), restating its commitment towards a zero coronavirus transmission.

This was disclosed by the Regional Manager South-South and South-East of FAAN, Abayomi Akinbinu, on Saturday, July 11, during the arrival of the first flight after 3 months of shutdown due to the coronavirus outbreak.


The first flight, which was conducted by Air Peace 5N EUV from Lagos, arrived Port-Harcourt International Airport terminal at 7.50 am.

He said the Port-Harcourt airport management was ready to ensure zero chances of the coronavirus transmission with the management giving no room for default of the COVID-19 safety guidelines by regulatory authorities as flight operations resume at the airport.

Explore Research Data From Nairametrics on Nairalytics

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He frowned at the non-adherence to physical distancing rule, while also commending safety compliance level by service providers and passengers at the airport.

According to Abayomi, “Our markings of 1.5 metres apart are visibly on the floor, but maybe because of excitement it’s not being properly followed; so we need to make quick enforcement in that regard.”

He said although there was low turnout of passengers, he expected a gradual increase in the coming days.

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He said, “On the departure section, we are gradually getting more passengers and I believe that going forward passengers’ turnout is going to increase. My message to prospective passengers is that the Port Harcourt International Airport terminal is safe.”

READ ALSO: Turkish Airlines tells staff to expect 55% pay cut in April

On his own part, the Head of Aviation Medical Clinic of the airport, Dr Nuhu Mwabi, said that the Port Health is seriously conducting mandatory temperature checks on both service providers and passengers before allowing them into the airport terminal building.

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Nuhu said, “This is because we want to fish out persons with a temperature of 38 degrees Celsius and above, so that we can isolate such individual. Our cardinal objective is to ensure that we contain the spread of COVID-19 as well as other communicable diseases within the airport.”

He added that the World Health Organization and the various medical teams were ready to professionally handle any suspected case, should the need arise.

It can be recalled that the Minister of Aviation, Hadi Sirika, had last week announced the resumption schedule for flight operations for the various airports across the country. The Murtala Muhammed Airport Lagos and the Nnamdi Azikiwe International airport resumed flight operations on July 8.


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