By Jeph Ajobaju, Chief Copy Editor
Aso Rock has put a positive spin on the report on Monday by the National Bureau of Statistics (NBS) that Nigeria’s Gross Domestic Product (GDP) declined -6.10 per cent (year-on-year) in the second quarter of 2020 (Q2 2020).
It scoured from Europe to Japan to the United States to argue that compared with other countries, Nigeria ended a “three-year trend of low but consistently improving positive real growth rates … since the 2016/17 recession.”
The point was made on Wednesday by Presidential Media and Publicity Adviser, Femi Adesina, in a statement which acknowledged that for Q2 2020, real GDP declined by -2.18 per cent year-on-year, compared with 2.11 per cent in Q2 2019.
“The overall decline of -6.1 per cent (for Q2 2020) and -2.18 per cent (for H1 2020) was better than the projected forecast of -7.24 per cent by the NBS.
“The figure was also relatively far better than many other countries recorded during the same quarter,” he said.
“Furthermore, despite the observed contraction in economic activity during the quarter, it outperformed projections by most domestic and international analysts.
“It also appears muted compared to … other countries, including large economies such as the U.S. (-33 per cent), UK (-20 per cent), France (-14 per cent), Germany (-10 per cent), Italy (-12.4 per cent), Canada (-12.0 per cent), Israel (-29 per cent), Japan (-8 per cent), South Africa (projection -20 per cent to -50 per cent), with the notable exception of only China (+3 per cent).”
Adesina said Abuja’s anticipation of economic slowdown and initiatives introduced as early responses to cushion the economic and social effects of coronavirus, through the Economic Sustainability Programme (ESP), “contributed immensely to dampening the severity of pandemic on growth.”
On the fiscal side, he argued, a robust financing mechanism was designed to raise revenue to support humanitarian assistance, in addition to special intervention funds for the health sector.
“Adjustments to the national budget as well as emergency financing from concessional lending windows of development finance institutions were critical in supporting governments’ capacity to meet its obligations.”
On the monetary side, he added, moratorium on loans, credit support to households and industries, regulatory forbearance and targeted lending and guarantee programmes through NIRSAL were some of the measures implemented in response to the pandemic during the second quarter.
“It is equally worth noting that since the start of the third quarter, the phased approach to easing the restrictions being implemented centrally and across states have resulted in a gradual return of economic activity, including the possibility of international travel.
“More importantly, the anticipated health impacts of the pandemic have been managed without overwhelming the health infrastructure, which would have further compromised the ability to re-open the country to travel, commerce and international trade.
“Indeed, this has provided greater confidence and ability for authorities to initiate the conduct of nationwide terminal examinations and resumption of the next academic year.
Adesina said Aso Rock anticipates that while Q3 and Q4 will reflect continued effects of the slowdown, the Fiscal and Monetary Policy initiatives being deployed in will be a robust response to the challenges posed by coronavirus.
“As the country begins the gradual loosening up of restrictions, and levels of commercial activity increase by people returning to their various livelihoods and payrolls expand, it still remains imperative that all the necessary public health safeguards are adhered to so the country avoids an emergence of a second wave.”
