As in the rest of the world, the ongoing COVID-19 pandemic is having a major impact in Nigeria. With mass gatherings out and social distancing in, life is a lot different for many Nigerians right now. Of course, it is not just personal freedom that COVID-19 restrictions affect. The Nigerian economy is also looking at a period of depression and the prospect of severe recession.
This, of course, comes hot on the heels of the 2016 recession in Nigeria, which people will remember all too well. A small crumb of comfort for Nigerians is that any expected economic downturn is likely to happen on a global scale. When you factor in the global impact on jobs and the huge borrowing by many countries, including the UK, the upcoming recession is going to hit many countries worldwide
The key thing for Nigeria now is to plan for this and look for ways to stabilize the economy, so it can deal with any economic depression. But how could it do this?
Collapsing oil prices are likely to hit Nigeria hard in the coming months. This also hints at one major problem the country’s economy still has – an overreliance on the revenue oil brings in. A key step to stabilizing the Nigerian economy in the future, therefore, is finding ways of bringing money into it that do not rely on oil production.
If the Nigerian government can help the country open up other major revenue streams, this could be what is needed to make it through any global downturn. Of course, the key is to diversify into areas that will not be unduly affected or that can prosper under a downturn. Good examples that ministers could consider investing in include IT, agriculture and transportation. Diversification could also help in terms of creating sustainable industries to supply goods that are needed. This would slash the amount that Nigeria spends on importing goods and help ease the pressure on total spending as a result.
One area that the government could look into is further encouraging the country’s online casino sector. This is one industry that is not only very popular with the public but which can also raise huge money in tax revenues for the national coffers. As online casinos have to pay fees and taxes on their own revenues to the Nigerian government, encouraging more online casinos would help stabilise the economy during a recession. Of course, there are some top Nigerian casinos online to play at already – but there is always room for more.
If the Nigerian government could encourage big-name global brands to invest in the country, this could not only see more money coming into Nigeria from outside but also create jobs. The added bonus is that Nigerians will spend the money won from playing games in the local community, which will help businesses survive.
Of course, stabilising the Nigerian economy over a severe recession also comes down to good fiscal policy from the government. While ministers need to find ways to protect the economy, they must balance this with a sensible approach to putting money into it. Whether this is keeping inflation down, finding ways to encourage private business or keeping national borrowing in check, the decisions made in this area will be critical. If more policies such as the recent survival funds for small businesses in Nigeria can be created, it could help a lot.
It is widely accepted that education and training are key to the health of any country’s economy. Having a trained, skilled workforce helps separate a country from others, while also giving them a competitive advantage globally. This sort of advantage could be key in any worldwide recession, as it will help a country to attract business investment and thus create jobs. With this in mind, Nigeria could look at putting more effort into education and training for its citizens.
The simple fact is that COVID-19 has made such a huge impact globally that most people know an economic depression is due to follow for many countries. Nigeria looks set to be one of those countries and this means the government must plan now for how it will protect the economy. As the above shows, there are some great ways to go about it and keep the country safe until things get back to normal again.