PricewaterhouseCoopers (PwC) has projected that Nigeria’s gross domestic product (GDP) growth rate will likely fall between -1.5 percent and 0.5 percent in the fourth quarter of 2020.
This is contained in the December 2020 Nigeria Economic Alert released by the firm on Monday.
It projected that the fourth quarter GDP quarter will translate to an annual contraction of two percent in 2020 — better than the GDP projections released by the International Monetary Fund (-4.3 percent) and World Bank (-3.2 percent).
“Against this backdrop, the country’s economic growth rate in Q4 2020 could most likely fall between 1.5% and 0.5% … “
Nigeria’s economy slipped into its second recession in four years against the backdrop of the COVID-19 pandemic and low crude oil prices.
“The pandemic has exposed oil-dependent economies to the twin shock of a bearish international oil market and disruptions to global and domestic supply chains for the movement of goods, people and services,” the economic alert read.
“Nigeria’s leading indicators reflect that the expected pace of recovery in Q4 2020 could reflect an improvement from the previous quarter. The purchasing managers’ index shows a marginal uptick in October/November compared to the third quarter of 2020, which also aligns with the consumer and business expectation survey reported by the Central Bank of Nigeria (CBN).
“Against this backdrop, the country’s economic growth rate in Q4 2020 could most likely fall between 1.5% and 0.5%, translating to a 2% annual contraction in 2020 from a growth of 2.3% in 2019. This growth rate is better than most outlooks for Nigeria (IMF: 4.3% and World Bank: 3.2%).”
PwC said the best approach to expediting Nigeria’s economic recovery is by implementing fiscal reforms, especially those contained in the Nigeria Economic Sustainability Plan (NESP) in addition to the proposed amendments in the 2020 finance bill.