By Modupe Gbadeyanka
The presidency has reacted to the 6.10 per cent decline in the nation’s Gross Domestic Product (GDP) for the second quarter of 2020 as released by the National Bureau of Statistics (NBS) on Monday.
In a statement issued on Wednesday by the Special Adviser to the President on Media and Publicity, Mr Femi Adesina, the presidency said the shrinking of Nigeria’s economy in the period under review was expected.
However, Mr Adesina said when compared with GDPs of advanced countries around the globe, Nigeria did not do badly.
“It also appears muted compared to the outcomes in several other countries, including large economies such as the US (-33 per cent), UK (-20 per cent), France (-14 per cent), Germany (-10 per cent), Italy (-12.4 per cent), Canada (-12.0 per cent), Israel (-29 per cent), Japan (-8 per cent), South Africa (projection -20 per cent to -50 per cent), with the notable exception of only China (+3 per cent),” the statement said.
On Monday, the stats office released the figures showing the economic growth of the country between April and June and from the numbers, there was a contraction of 6.10 per cent (year-on-year) in real terms, ending the 3-year trend of low real growth rates since the 2016/17 recession.
Consequently, for the first half of 2020, real GDP declined by 2.18 per cent year-on-year compared with 2.11 per cent recorded in the first half of 2019.
In the statement, the presidency said things could have been worse if not for the proactive measures put in place by the government when key economic states of the federation were placed on lockdown because of COVID-19.
In almost half of the second quarter, there the federal government totally locked down Lagos, Abuja and Ogun State to control the spread of coronavirus.
According to Mr Adesina, the anticipation of the impending economic slowdown made the government of President Muhammadu Buhari to introduce “various initiatives” to cushion the economic and social effects of the pandemic, through the Economic Sustainability Programme (ESP), contributed immensely to dampening the severity of the pandemic on growth.
According to him, a robust financing mechanism was designed to raise revenue to support humanitarian assistance, in addition to special intervention funds for the health sector.
“Adjustments to the national budget as well as emergency financing from concessional lending windows of development finance institutions were critical in supporting governments’ capacity to meet its obligations,” he said.
Also, Mr Adesina said the monetary authorities came up with “moratorium on loans, credit support to households and industries, regulatory forbearance and targeted lending and guarantee programs through NIRSAL were some of the measures implemented in response to the pandemic during the second quarter.”
He said since the start of the third quarter, the phased approach to easing the restrictions being implemented centrally and across states have resulted in a gradual return of economic activity, including the possibility of international travel.
“It is anticipated that while the third and fourth quarters will reflect continued effects of the slowdown, the fiscal and monetary policy initiatives being deployed by government in a phased process will be a robust response to the challenges posed by the COVID-19 pandemic,” he said.
“Furthermore, as the country begins the gradual loosening up of restrictions, and levels of commercial activity increase by people returning to their various livelihoods and payrolls expand, it still remains imperative that all the necessary public health safeguards are adhered to so the country avoids an emergence of a second wave,” he concluded.
