Africa’s giant, Nigeria, is awakening to a new economic and social reality as a result of the coronavirus crisis. The country of two hundred million has already recorded over fifty cases and its first COVID-related death. News of high-profile infectees is starting to drive social change and spur calls for stronger government action. Members of parliament and other elite figures are facing public pressure, particularly on social media, to adhere to screening and self-quarantine policies to stem the spread of COVID-19. Mohammed Atiku Abubakar, the son of President Buhari’s opponent in the 2019 election, has been said to be infected with the coronavirus. So is President Buhari’s chief of staff and the governor of Bauchi state.
Nigeria is Africa’s largest oil exporter, and a drop in oil prices to the lowest point in eighteen years has eviscerated government coffers. The Buhari administration had benchmarked the 2020 national budget at $57 per barrel, and sustained prices below $30 per barrel will immediately impact the country’s ability to make a major fiscal injection into the economy to counter COVID-19, given that oil constitutes over 90 percent of export revenue and foreign exchange earnings.
The resultant pressure on the naira is forcing the Central Bank back into the same dilemma it faced during the 2016 recession—to either devalue the naira (which violates Buhari’s refusal to “kill the naira” and increases the costs of everyday imported goods), or attempt to dance around devaluation through technical adjustments. Already, in response to an increase in the street value of the dollar to the naira and concern over the limited months of import cover, Central Bank Governor Godwin Emefiele moved the naira-to-dollar peg up by 15 percent to 380 on March 20.
As in other countries across the globe, international trade and business travel is grinding to a halt. Nigeria closed all land borders to human traffic and both major airports in Lagos and Abuja to international arrivals and departures on Monday, March 23. Nigerian government agencies and businesses are beginning to adjust to new working realities: work from home policies are starting to be implemented this week, though many corporate leaders are worried about employee productivity given the irregularity of electricity and wifi. Civil servants were also asked to work from home on Monday, and all large public gatherings (religious services, weddings, funerals, sporting events, etc.) were discouraged.
Nigeria will closely watch the recent moves in South Africa and Kenya to implement countrywide dramatic shutdowns to stop the spread of the virus before weak health systems quickly become overwhelmed. A federal system, like the United States, Nigeria’s states are already proactively responding. Niger state, for example, has imposed a curfew and has banned gatherings of more than twenty people. Similar federal responses can be expected in the coming days, with the Kaduna state governor pledging his willingness to impose curfews if necessary, to likely be followed by a nationwide directive soon.
Public confidence in the health system was tried last week as doctors in Abuja went on strike for several days during the crisis over issues around backpay, and the country has begun to try to mobilize retired doctors and nurses. Ensuring that reliable medical information reaches the population is a struggle in Nigeria as in other countries. Upon some early reporting that chloroquine could help treat COVID-19, the price on the street tripled and Nigeria reported its first death from chloroquine poisoning.
Nigeria’s ability to manage the coronarvirus crisis as effectively as it did the Ebola epidemic in 2014 has yet to be seen, but the economic response to the global downturn is likely to be less robust. The government has pledged a 25 percent reduction in recurrent expenditure which will be hard to execute. Instead of decreasing the petrol subsidies, the government has increased the subsidy in anticipation of growing hardship among the average Nigerian from inflation on foodstuffs. The haphazard economic management that was seen in 2016 is likely also to define the 2020 approach. In 2018, Nigeria surpassed India in the number of people living in abject poverty, and with recession returning to Nigeria that number will only grow. In this environment, millions of Nigerians will be at risk of dying from the diseases of poverty (malaria, diarrhea, lassa fever, etc.) in addition to the threat from COVID-19.
Asian countries have seemed to turn a corner in the past week in stemming the spread of the coronavirus. Nigeria prides itself on being the big player in the region, thinking big and dreaming big, but successfully managing the coronavirus will require big actions and bold reforms.
Aubrey Hruby is a senior fellow with the Atlantic Council’s Africa Center. She is also Co-Founder of Insider and the Africa Expert Network. Follow her on Twitter @AubreyHruby.
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