Nigeria: Oil and coronavirus containment will drive GDP trajectory – Standard Chartered

Nigeria’s planned oil production cuts would drag real GDP growth to negative levels in 2020, economists at Standard Chartered Banks apprise. USD/NGN is trading at 390.00

Key quotes

“We see GDP contracting by 4.3% in 2020 versus our previous forecast of 0.2% growth. We forecast growth rebounding to 2.5% in 2021 (1.6% previously) and see 2022 GDP growth at 3.1% (0.8%).”

“Weak health-care capacity across the country, a high degree of economic informality that limits the room for policy to play a mitigating role, and difficulties in enforcing social distancing in more densely populated areas all raise the risk that the economic impact of the COVID-19 crisis will be prolonged.”

“Weak oil demand and a shortage of storage capacity globally likely mean that Nigeria will be forced to cut back on oil production, even before new OPEC++ output curbs take effect from May.”