Recession looms as IMF projects -3.4% growth in Nigeria

Recession looms as IMF projects -3.4% growth in Nigeria

- The International Monetary Fund (IMF) has projected negative growth for the Nigerian economy following the COVID-19 pandemic

- The IMF stated that the Nigerian economy will face a negative growth of -3.4%, indicating a recession in the country

- The financial institution noted that the global economy is projected to contract sharply by -3% in 2020

The International Monetary Fund (IMF) has projected negative growth for the Nigerian economy following the COVID-19 pandemic.

The IMF stated that the Nigerian economy will face a negative growth of -3.4%, indicating a recession in the country, The Nation reports.

The financial institution projection was contained in the April 2020 World Economic Outlook report released on Tuesday, April 14, in Washington.

It stated that the global economy is projected to contract sharply by -3% in 2020, much worse than during the 2008–09 financial crises as a result of the coronavirus pandemic.

According to the IMF, the global economy could grow by 5.8% in 2021 as economic activity normalizes.

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Meanwhile, in a bid to assist third world countries over the harsh economic effect of coronavirus, international personalities and presidents of notable nations are mobilising the sum $600 billion from the International Monetary Fund (IMF).

The world leaders include a former prime minister of the United Kingdom (UK) Gordon Brown and Olusegun Obasanjo.

Alongside global economic leaders, Obasanjo and others made the call for a decisive and concerted global response to the pandemic, Vanguard reports.

The move is expected to raise a multi-billion dollar anti-coronavirus fund which will be spearheaded by the G-20 countries.

Aside from making efforts to raise $8 billion emergency global health fund to prevent another wave of the pandemic, the leaders are calling for an agreement by the multilateral finance organizations to waive the debt interest payments for the impoverished regions of the world.

In their projection, they pointed out that not less than $35 billion is needed for ventilators, test kits and protective equipment for health workers who are on fieldwork in the fight to contain the disease.

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In another report, one of the top rating agency in the world, Fitch Ratings has downgraded Nigeria's credit rating to B from B+ while also assigning a negative outlook.

According to the international agency, the recent slump in oil prices and the pandemic shock will put pressure on Nigeria's external finances.

Going further, Fitch noted that the collapse in oil revenues and the slowdown in economic activity will take a toll on the "government's already weak fiscal revenues.

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