Nigeria might fall into recession in the third quarter, the head of the country’s budget office said on Thursday, citing the impact of low oil prices and the coronavirus pandemic on Africa’s largest economy.
The continent’s top oil producer faces its worst economic crisis in four decades in the wake of an oil price war between Russia and Saudi Arabia at the start of the year, and the pandemic, which hurt demand for its main export commodity which provides 90% of foreign exchange earnings, according to Reuters report.
Director General of the budget office, Ben Akabueze was quoted by the newswire to have said on Thursday that it was expected that growth in the third quarter would be negative and the country might fall into recession.
It would be the second quarter of negative growth after the economy contracted by 6% in the second quarter of the year.
Nigeria’s economy was last in recession in 2016, its first in 25 years, since when growth has been sluggish.
The International Monetary Fund has said it sees Nigeria’s GDP falling 5.4% this year, and the government has said the economy may shrink by as much as 8.9%.