Nigeria’s economy to drop by 3.2% in 2020, World Bank predicts

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By Francis Ogwo

Nigeria’s economic activities have been projected by the World Bank to shrink by 3.2% in 2020, which has been regarded as the most severe in forty years.

According to the global bank on Monday, Nigeria relies heavily on oil revenues, which sums up over 80% of exports, about one-third of banking-sector credit, and one-half of general government revenues.

It stated that Emerging Market and Developing Economies (EMDEs) are likely to shrink by 2.5% in 2020, which would be their first contraction as a group in at least sixty years.

There will also be a decline in per capita income by 3.6%, which will plunge millions of people into extreme poverty in 2020.

Furthermore, the World Bank said there will also be a shrink of 7% in economic activities among advanced economies with the disruption of domestic demand and supply, trade, and finance.

The forecast also said the global economy will experience a 5.2% shrink this year, which it terms as the deepest recession since the Second World War.

“This would see the largest fraction of economies experiencing declines in per capita output since 1870,” the World Bank stated in its June 2020 Global Economic Prospects.

Reports say the effect of the pandemic on world economies have crumbled businesses, which have high dependence on global trade, tourism, commodity exports, and external financing and there are expected regional variations in the magnitude of disruptions.

It lamented that all EMDEs have had their vulnerabilities magnified by external shocks with an equally huge impact on schooling and primary healthcare access due to the interruptions.

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