Nigeria expects the third and fourth quarters to reflect the continued effects of a slowdown, after the economy contracted by 6.1% in the second quarter, the presidency said on Wednesday.
Nigeria, Africa’s largest economy and top oil producer, faces its worst crisis in four decades due to low crude prices, and the impact of the novel coronavirus pandemic, which hurt demand for its main export commodity.
“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,” said a statement issued by the presidency.
Policymakers face a raft of challenges. Inflation rose to 12.82% in July, its highest level in more than two years, and the unemployment rate stood at 27.1% in the second quarter.
Nigeria’s economy was already grappling with sluggish growth before the pandemic following a 2016 recession. The International Monetary Fund has said it sees Nigeria’s GDP falling 5.4% this year, while the government has said the economy may shrink by as much as 8.9%.