Partner, West Africa Financial Services of PricehouseWaterCooper (PwC), Dr. Andrew Nevin, has disclosed that COVID- 19 has so disrupted the economy like never before since independence, with only 13 sectors sustaining the country’s Gross Domestic Product (GDP) marginally.
Nevin, who made this disclosure in his assessment of government’s economic interventions, said as things stand now in the economy, it is only 13 sectors that are sustaining the country’s gross domestic product (GDP) marginally, with about 33 sectors of the economy already declining into partial recession.
He identified the biggest hit among the sectors in Nigeria as oil and gas, manufacturing, hospitality, services, aviation, health and real estate, among others, with the impending effect already being felt in the economy.
“The pandemic has caused the greatest economic disruption ever experienced with 33 sectors of the economy declining and 13 sectors growing.
“Declining oil revenue, which led to declining oil taxes, does not bode well for the 2020 budget implementation.”
Nevin, however, said reports indicated that the nation held at least $300 billion or as much as $900 billion dead capital in residential real estate and agricultural land alone, which is now a setback for investors in the country’s real estate sector.
“As a result, there is no better time than now to unlock the potential and harness this capital for wealth creation and economic growth post COVID-19,” he said.
He appealed to government to unlock dead capital, optimise assets, reduce corruption and leakage and prioritise expenses to focus on human capital development and critical infrastructure.
“Government needs to cut waste and leverage digitalisation to build a trail for data to expand tax base.
“There should be no new taxes, no higher rates and no additional compliance burdens on businesses and consumers alike. Businesses must rethink competitive advantage and upscale skill for agility to mitigate the impact of the pandemic,” he said.
Nevin pointed out that foreign investors were apprehensive, as risks to domestic economy are heightened. “Developing economies are on the back foot as interventions yield marginal benefits on the back of declining revenue flows.”
