Research Document: NESG H1’2020 Economic Review, September 2020

Posted Tue, Sep 15, 2020 7:04 AM

The year 2020 has been forecast to hold great promises for not only Nigeria but also the rest of the world, particularly, as the US-China trade tension was expected to become subdued. This optimism was, however, shattered by the sudden outbreak and rapid spread of the coronavirus pandemic from Wuhan City of China to other countries. The viral infection has pervaded over 190 countries and territories of the world, with the worst hit being the United States, which slipped into recession in Q2’2020. Other advanced countries including the United Kingdom, Spain, France, Italy, and Germany officially slipped into recession after contracting sharply by -20.4%, -18.5%, -13.8%, -12.4%, and -9.7%, respectively, in Q2’2020 (see Figure 1 in the document to be downloaded). This is not unexpected as most countries are returning to lockdown restrictions following the second wave of coronavirus outbreak. However, China recorded a growth rebound in Q2’2020, following a contraction of 6.8% in the previous quarter. In its revised global economic outlook for 2020, the International Monetary Fund projected that most advanced countries, as well as emerging and developing economies, would contract sharply in 2020. Nigeria is no exception as the IMF projects the economy to contract by 5.4% in 2020.