Oil revenue from Africa’s largest crude oil producer, Nigeria, shed $1.09bn in the first quarter of 2020, the country’s Minister of Finance, Budget and National Planning, Zainab Ahmed has said.
The minister explained during a presentation at the National Econiomic Council’s first virtual meeting, which was presided over by Vice President Yemi Osinbajo, that the net oil and gas revenue inflows to the federation account for the time under review amounted to $2.4bn.
She said the shortfall recorded represents 31.1 per cent of the prorated amount.
The global economy has been seeing unprecedented economic reversal since the COVID-19 pandemic led to a global oil price collapse and forced many countries into lockdown.
In Nigeria where the economy depends heavily on petrodollar, the second quarter is expected to be grimmer as predictions suggest the economy would contract by at least 3 per cent.
Ahmed said to prevent a deep recession, the approach in Nigeria as used all over the world would be to deploy a stimulus package.
According to the minister, as of May 21, Nigeria’s excess crude account, set up few years ago to save proceeds of oil at the time of boom, had a balance of $72.4m, Nigeria’s stabilization account had$101.2m while natural resources and development fund account had $322.2m.
Meanwhile, with the grim days ahead, Nigeria is now embarking on a national economic sustainability plan.
A statement from the office of the Vice President said, “Such a plan is expected to introduce a sustainability stimulus package running into a couple trillion naira; ensure that Nigeria as a country gets through the COVID-19 economic challenges and in fact, chart a path of growth and development for the Nigerian economy by ensuring massive productivity in several sectors including agriculture power, infrastructure, technology and several others.”
Many Nigerians believe the government is still insincere about cutting costs and making governance sustainable in the fact of dwindling resources.
Perhaps, in the coming months, as has been advocated by many experts, plans would include cutting down on the number of ministries and parastatals and political appointments.