BY VICTORIA ONU, ABUJA
THE World Bank has said that the absence of measures to mitigate the twin impact of the Coronavirus pandemic and fall on crude oil prices could raise the number of poor people in Nigeria by between 15 million to 20 million by 2022.
The international finance institution said this on Thursday, in its Nigeria Development Update, just as it projected that the Nigerian economy could shrink by up to four per cent in 2020 following the twin shocks of COVID-19 and low oil prices.
The National Bureau of Statistics had, in a report about poverty and inequality from September 2018 to October 2019, said 40 per cent of Nigerians lived below the poverty line of N137,430 ($381.75) a year. This represents 82.9 million people, according to the Bureau.
With the new World Bank’s forecast, which says up to 20 more people may be added to this figure, the number of poor Nigerians is expected to hit 102.9 million by 2022.
The World Bank said the pace of recovery in 2021 and beyond remained highly uncertain and subject to the pace of reforms.
It said the pandemic was disproportionately affecting the poor and most vulnerable, women in particular.
The World Bank said that food insecurity had increased substantially, adding that economic precariousness was on the rise because unemployed workers had migrated to the low-productivity agricultural sector.
In the next three years, the World Bank said an average Nigerian could see a reversal of decades of economic growth and the country could enter its deepest recession since the 1980s.
The Report argued that this path could be avoided if progress in the current reforms was sustained and the right mix of policy measures implemented.
While acknowledging measures taken by the government since April, including the efforts to harmonise exchange rates, introduce a market-based pricing mechanism for gasoline, adjust electricity tariffs to more cost-reflective levels, reduce non-essential expenditures and redirect resources towards the COVID-19 response, it said there was a need for greater policy response to the economic crisis.
It also highlighted the greater transparency in the oil and gas sector and public debt as essential steps for a resilient recovery.
The World Bank Lead Economist for Nigeria and co-author of the report,
Marco Hernandez, said, “Nigeria can build on its reform momentum to contain the spread of COVID-19, stimulate the economy, and enable the private sector to be the engine of growth and job creation.
“It can also redirect public spending from subsidies that benefit the rich towards investments in Nigeria’s people and youth in particular, and lay foundations for a strong recovery to help make progress towards lifting 100 million people out of poverty.”
The report, titled, “Rising to the Challenge: Nigeria’s COVID response”, takes stock of the recently implemented reforms and proposes policy options to mitigate the impact of COVID-19 and foster a resilient, sustainable and inclusive recovery.
The World Bank Country Director for Nigeria, Shubham Chaudhuri, while speaking on the Report, said Nigeria was at a critical historical juncture, with a choice to make.
“Nigeria can choose to break decisively from business-as-usual, and rise to its considerable potential by sustaining the bold reforms that have been taken thus far and going even further and with an even greater sense of urgency to promote faster and more inclusive economic growth,” he added.
Looking ahead, the Bank discussed policy options in five areas that would help mitigate the effects of the crisis and support Nigeria’s recovery.
