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Economic council raises alarm, says Nigeria might slip into recession again
THE Presidential Economic Advisory Council, PEAC on Tuesday raised warnings about grim economic consequences that Nigeria might experience if the Coronavirus outbreak is not contained soon.
President Muhammadu Buhari met with the council in a closed-door meeting chaired by Prof Doyin Salami at the statehouse.
Salami told Buhari that one of the immediate consequences, as determined in the crash of crude oil prices, was slower economic growth, that might affect confidence in the economy.
Hence, the council advised immediate cuts in the budget.
It also noted that Nigeria risked receding into another recession if concrete measures were not effected to stabilise its economy.
The council added that global oil glut, rise in unemployment, depletion of foreign reserves and trade imbalance were other consequences.
In a statement released by Mr Femi Adesina, Buhari’s media aide, the council said, “Many countries around the world may go into economic recession, the PEAC advocated hard work for Nigeria to keep its head above the waters.
“Recommending, among others, a possible revision of the 2020 budget, with priority spending on healthcare, re-prioritisation of expenditure on infrastructure to focus on projects nearing completion with pro-poor effects, curtailing recurrent expenditure, mobilising the private sector to strengthen health sector infrastructure, and boosting of government revenue, the PEAC stressed that the projections may seem dire, but the worst may be avoided with hard work and scrupulous implementation of policies.”
Buhari who spoke at the end of the session said he was aware that oil price has fallen between $29 and $30 per barrel, well below the $57 used as the benchmark for the 2020 budget.
“We will see how to survive fallen prices, as we already envisaged the problem,” he said.
After the country exited an economic recession in 2017, the government said other business and development avenues would be explored in order to diversify its economy and make it less dependent on crude oil.
However, Nigeria is still heavily dependent on oil to fully fund its national budgets.