More revelations on the impact of coronavirus (Covid-19) pandemic on the economy are still emerging as various agencies take stock even as the second wave unfurls its threat.
The pandemic, which rocked most parts of the world, including Nigeria in 2020, was said to have slowed investment inflow globally, with Nigeria being unable to realise a $9.01 billion proposed inflow in 2020. Disclosing this in Abuja,
the Executive Secretary, Nigerian Investment Promotion Commission (NIPC),Yewande Sadiku, said to reverse the trend, there should be a more proactive government approach to support investors across the federation to convert more announcements to actual investments. She added other nations also experienced investments decline as a result of the pandemic.
She said Nigeria required bold and coherent policy changes and deep economic reforms to reverse decline in foreign direct investments flow expected in the 2021 fiscal period.
Sadiku, who spoke in Abuja at a retreat for Commerce and Industry Correspondents Association, said due to the pandemic, a decline of between 40 per cent and 50 per cent was expected in 2020/2021, adding that this was the lowest level in almost 20 years.
In a presentation entitled, “Understanding the Impact of COVID-19 on Investment in Nigeria,’’ Sadiku highlighted the impact of the pandemic on global economic growth and FDI. She said, globally, FDI had been falling since 2015 while in Nigeria FDI flow has been under pressure before COVID- 19. She noted that the impact was expected to be worse than the global financial crisis due to the negative effect of the pandemic.
She said that FDI was stagnated during the COVID-19 lockdown because there was shutdown on implementation of ongoing projects due to closure of sites. She explained that due to the pandemic, there was tightening margins for investment while there was automatic effect on reinvested earnings, a key component of FDI.
Based on NIPC investments announcement, Sadiku noted that the commission tracked in 2017, $73.07 billion investments in 2018, $24.44 billion in 2019 and $9.01 billion in 2020. Speaking on the latest World Economic Outlook Growth Projections, she said Nigeria’s Gross Domestic Product projection was 2.2 per cent in 2019, 4.3 per cent in 2020 and 1.7 per cent being projected for 2021.
According to Sadiku, these projections are expected to be lowered as long as the pandemic persists. She advised that the Nigerian industrial development polici e s should align with foreign exchange to support FDI generation