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Coronavirus: Is Nigeria braced for Impact?

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The Minister of Finance, Budget and National Planning, Zainab Ahmed has hinted that the Federal Government may review its 2020 National budget, as a result of the adverse impact of the Coronavirus outbreak. The epidemic, which has been described as a global health emergency by the World Health Organisation (WHO) is affecting economic activities globally, particularly the price of crude oil, which has fluctuated in recent weeks and dropping below Nigeria’s benchmark price of $57 as indicated in its 2020 National budget. The price drop may mean that with the country’s petroleum dependent economy, revenue projections may not be met.

Reacting to the oil price drop, President Buhari reportedly set up a committee made up of the Minister of Finance, Budget and National Planning, the Minister of State for Petroleum Resources, the Governor of the Central Bank of Nigeria (CBN) and the Group Managing Director of the Nigeria National Petroleum Corporation (NNPC), to immediately review the impact of the oil price drop in the 2020 National Budget and report back to him. There is no doubt that the consequence of a nearly 50%  drop in projected oil revenue could be dire for Nigeria. It should be noted that a similar sharp drop in oil prices in 2014 threw Nigeria into a recession and witnessed a free fall of the national currency.