The Presidency on Wednesday said the nation’s economy,
despite contraction, performed better than that of the United States, United
Kingdom, France, Germany and others in the second quarter of 2020.
The National Bureau of Statistics (NBS) had said the
nation’s Gross Domestic Product, GDP declined by –6.10% (year-on-year) in real
terms in the second quarter of 2020, ending the 3-year trend of low but
consistently improving positive real growth rates recorded since the 2016/17
recession.
It said consequently, for the first half of 2020, real GDP
declined by –2.18% year-on-year, compared with 2.11% recorded in the first half
of 2019.
Reacting to NBS’ figures, the presidency in a statement
issued by the Special Adviser to the President on Media and Publicity, Femi
Adesina said the overall decline of -6.1% (for Q2 2020) and -2.18 per cent (for
H1 2020) was better than the projected forecast of -7.24% as estimated by the
National Bureau of Statistics.
He said the figure was also relatively far better than many
other countries recorded during the same quarter.
“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 the outcomes in
several other countries, including large economies such as the US (-33%), UK
(-20%), France (-14%), Germany (-10%), Italy (-12.4%), Canada (-12.0%), Israel
(-29%), Japan (-8%), South Africa (projection -20% to -50%), with the notable
exception of only China (+3%).
“The government’s anticipation of the impending economic
slowdown and the various initiatives introduced as early responses to cushion
the economic and social effects of the pandemic, through the Economic
Sustainability Programme (ESP), contributed immensely to dampening the severity
of the pandemic on growth,” he said.
On the fiscal side, Adesina said a robust financing
mechanism was designed to raise revenue to support humanitarian assistance, in
addition to special intervention funds for the health sector.
He said 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, moratorium on loans, credit support
to households and industries, regulatory forbearance and targeted lending and
guarantee programs 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,” he added.
According to Adesina, more importantly, the anticipated
health impacts of the pandemic had 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.
He said this had provided greater confidence and ability for
authorities to initiate the conduct of nationwide terminal examinations and
resumption of the next academic year.
“Finally, 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.
“Furthermore, 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,” he stated.
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