COVID-19 pandemic and economic crisis: the Nigerian experience and structural causes

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COVID-19 pandemic and economic crisis: the Nigerian experience and structural causes

Abstract

This paper analyses the COVID-19 situation in Nigeria, its effect on the economy and the structural causes that worsen the coronavirus (COVID-19) crisis. The findings reveal that the economic downturn in Nigeria was triggered by a combination of declining oil price and spillovers from the COVID-19 outbreak, which not only led to a fall in the demand for oil products but also stopped economic activities from taking place when social distancing policies were enforced. The government responded to the crisis by providing financial assistance to businesses and a small number of households that were affected by the coronavirus (COVID-19) outbreak. The monetary authority adopted accommodative monetary policies and offered a targeted ₦3.5trillion loan support to some sectors. These efforts should have prevented the economic crisis from occurring but it didn’t. Economic agents could not freely engage in economic activities for fear of contracting the COVID-19 disease that was spreading very fast at the time.

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