According to reports, Nigeria has slipped into a second phase of recession in five years, occasioned by the COVID-19 pandemic and a fall in oil price on the international market.

It is the country’s worst recession in almost four decades according to the World Bank. It is rather unfortunate that despite all the pointers that a recession was imminent, the government failed to put measures in place to cushion its effect.

A recent report by the National Bureau of Statistics (NBS) indicated that the nation’s GDP recorded negative growth of 3.62 per cent in the third quarter of 2020. The country was said to have recorded a 6.10 per cent contraction in the second quarter. 

Nigeria’s economic outlook is obviously not looking good as it is. In spite of this, the Minister of Finance, Budget and National Planning, Zainab Ahmed, during the ongoing 26th Nigerian Economic Summit, said that the recession will be short-lived. 

No doubt, coming out of the recession will be a daunting task with the kind of government we have and considering the length of time it took the country to come out from the 2016 recession. If the government had learnt anything from it, it would have been proactive enough to put measures in place to guard against future occurrence or at least to cushion the effect of unforeseen circumstances such as this.

Besides the negative impact of the pandemic, FG’s lack of proactiveness is among the factors that have placed the country in such a precarious economic situation. The over-dependence on crude oil revenues in a country that is rich in mineral resources and arable land does not impact positively on the economy, neither is the high cost of governance helping matters. 

On several occasions, Nigerians have called for the diversification of the economy and the need to cut down the cost of governance for accelerated economic growth, as well as to save the country’s economy from the negative impact of the pandemic.

Earlier in the year, former Education Minister and Vice President of the World Bank, Oby Ezekwesili, warned the Buhari-led administration against purchasing a fleet of cars until the pandemic is contained to avoid a negative impact on the economy. She also disclosed that Nigeria was vulnerable to the global recession occasioned by the pandemic. Hence, the need to cut down on the cost of governance.

She said:

“Our country entered this situation already extremely vulnerable. It saddens me.

“One of the worst things in life that can happen to any people is to have an uncaring set of leaders in a time of crisis.

“Leadership of the NASS, Senate and House of Rep must immediately cancel their plan to purchase those fleets of vehicles. The finances of the country never justified such spending before.

“The worsened financial condition totally forbids such recklessness at this time.”

On the way forward, former Governor Peter Obi, has echoed similar sentiments on his Twitter page recently.

For Nigeria to pull itself out of this economic recession, the 2nd in the last 5 years, there's a compelling need to cut the pork out of the budget and expenditure at all levels of govt and redirect the economy from a wasteful consumption-based one to a productive economy. -PO

— Peter Obi (@PeterObi) November 22, 2020

On the part of human rights activist and former President of the Nigerian Bar Association (NBA), Olisa Agbakoba, as he suggested in an article; the diversification of the economy among other things is the way out of the recession. He described it as “one area government needs to urgently activate because of the massive budget deficit.”

With the already terrible state of the economy and the reduced purchasing power of the average Nigerian, following the hike in the price of basic commodities, a recession is obviously one thing Nigerians are not prepared for.

The government more than ever needs to heed the call of the people; they must diversify the economy and cut down the cost of governance to cushion the effect of the current recession before it is too late.