1.1 Background to the Study
Since the beginning of the year 2020, the world has been in shock with the outbreak of the Covid-19 pandemic. In February 2020, The World Health Organization (WHO) announced the outbreak of a new coronavirus (SARS-CoV-2) from China (Adhikari et al., 2020; Harapan, Itoh, Yufika, Winardi, Keam, Te, et al., 2020). According to WHO, the disease was first reported in the city of Wuhan, China, in December 2019 (Adhikari et al., 2020) and has since then spread like a wildfire to over 200 countries of the world. Simply put, the disease has become a global pandemic. It has resulted to massive economic disruptions across the globe. Economic experts have predicted that the pandemic could plunge the world into a global recession (Ozili, 2020). Also, the pandemic has claimed a significant number of lives across the globe.
Economically, coronavirus has been defined through the IMF as humanity darkest hour as the global economy have witnessed a standstill globally. The virus has put a heavy burden at national as well as global economies and also on individuals' finances. The Managing director of the International Monetary Fund, Kristalina Georgieva in a press report in April 23rd 2020, on the economic effect of Covid-19 revealed that, almost $90 billion has flown out of rising markets and growing economies because of the coronavirus pandemic. According to Kristalina (2020), the virus hits the vulnerable people with medical preconditions is the same way it hits vulnerable economies the hardest, expanding the vulnerability of developing economies and pushing their people into penury and loss of livelihoods.
In particular, the Nigerian economy, which was already fragile before the outbreak of Covid-19 late in 2019, was among the areas most noticeably hit by the pandemic. Talking as of late on the impact of COVID-19 on the Nigerian economy, the Minister of Finance, Budget and National Planning, Zainab Ahmed, said that before the episode of the Covid-19 pandemic, the Nigerian economy was at that delicate point and vulnerable. She clarified that the worldwide economic crisis due to the Covid-19 pandemic has brought about uncommon interruptions to global supply chains, a sharp drop in worldwide crude oil prices, turmoil in worldwide stock and financial markets, the lockdown of large swath movements of people in several nations and the likes.
These results, as indicated by the Nigerian minister, have had serious outcomes on families' jobs and business activities, coming from drop in worldwide demand, declined buyer confidence and slowdown in production. She said that Nigerian government has since updated its 2020 budget, slashing its income projection by about 40% and looking for emergency support from the International Monetary Fund, the World Bank and the African Development Bank to have the option to execute the 2020 budget.
In its survey of the effect of the COVID-19 on the core areas of the Nigerian economy, the Lagos Chamber of Commerce and Industry (LCCI), noticed that after the aftermath of the Coronavirus pandemic, We see the short to medium-term standpoint for the economy as depressing, as the pandemic has prompted a remarkable breakdown in commodity prices, capital flight, unrest in the capital market, supply chain disruption across areas and destabilization of business and financial activities. Thus, we reverberate with the International Monetary Fund's situation on an approaching severe contraction of the economy by year end-2020.
In the light of the foregoing, while existing literatures revealed that COVID-19 pandemic brought economic disruption; existing studies do not appraise the roles of economy on the lives of Nigerians in the post COVID-19 pandemic, much less, life after COVID-19 pandemic. The foregoing was identified as a research gap and triggers the researcher to carry out this study with the objective to offer illumination and add to existing body of conceptual knowledge on COVID-19 pandemic and Nigerian economy and life after COVID-19 pandemic.
1.2 Statement of the Problem
Though, the Covid-19 outbreak which began in the Wuhan area of China had spread its its problematic tentacles to Nigeria, the reason behind why the pandemic was severe in Nigeria and caused suffering to helpless citizens was a direct result of weak institutions that were ineffective in responding to the pandemic and the absence of sufficient social amenities provided by the government that would have catered for greater part of the helpless citizens and vulnerable citizens who were affected by the pandemic. The fear of monetary and economic breakdown prompted panic buying, hoarding of hard currency by people and organizations mostly for speculative reasons, trip to safety in investment and consumption, families stocking up on essential food and services, organizations requesting that workers should work from home.
This study assesses the COVID-19 pandemic in Nigeria, the economic crisis and the reasons for this. The COVID-19 pandemic has had great consequences for the worldwide economy (Ozili and Arun, 2020). It influenced the global travel business, public medical care systems, the food industry, events industry, education and worldwide trade. Because of globalization, there are assumptions for spillover impacts to arising and non-industrial nations because of their reliance on developed nations for the importation of goods and services (Ozili and Arun, 2020). The recent study has not analyzed the impact of COVID-19 on economic activities (Fernandes, 2020; Atkeson, 2020; Ozili and Arun, 2020). However, the new study has not analyzed the impact on COVID-19 on economic aggregates in developing countries such as Nigeria. The effect of COVID-19 on the Nigerian economy has not been investigated in the new writing. This examination fills this hole in the literature.
1.3 Objectives of the Study
This study has both general and specific objectives. The general objective of this study is to examine the effect of Covid-19 pandemic on the economy of Nigeria. However, the specific objectives are:
i) To understand the relationship between Covid-19 pandemic and the economy of Nigeria
ii) To examine the effects of Covid-19 pandemic on the socio-economic status of Nigerians
iii) To investigate the factors that worsen the economy crisis of Nigeria during Covid-19 pandemic
iv) To highlight the Nigerian policy responses to economic effect of Covid-19 pandemic
1.4 Research Questions
The research questions for this study include the following:
i) What is the relationship between Covid-19 pandemic and the economy of Nigeria?
ii) What are the effects of Covid-19 pandemic on the socio-economic status of Nigerians?
iii) What are the factors that worsen the economy crisis of Nigeria during Covid-19 pandemic?
iv) What are the Nigerian policy responses to economic effect of Covid-19 pandemic?
1.5 Research Hypotheses
The following statements were considered to be the research hypotheses for this study:
i) There is no significant relationship between Covid-19 pandemic and the economy of Nigeria
ii) There is a significant relationship between Covid-19 pandemic and the socio-economic status of Nigerians
1.6 Significance of the Study
Given that the Covid-19 pandemic is relatively recent, studies that discuss its effects on the Nigeria’s economy and possible policy responses by the Nigeria government to economic effect of Covid-19 pandemic are limited. This study, therefore, is among the first to discuss the effects of the Covid-19 pandemic on the Nigeria’s economy and possible policy responses by the Nigeria government to economic effect of Covid-19 pandemic. The study has highlighted a number of responses that can help Nigerians and the Nigerian government overcome the devastating effects of the Covid-19 pandemic and similar pandemics or economic crises in future. Certainly, Nigerians and the Nigerian government will be the first beneficiaries of this study. Also, people from other countries and governments of other countries will find this study useful. Moreover, future researchers will use this study as a reference material.
1.7 Scope of the Study
The study will cover on the effect of corona virus disease (COVID-19) on the Nigeria economy
1.8 Limitation of the Study
Financial constraint- Insufficient fund tends to impede the efficiency of the researcher in sourcing for the relevant materials, literature or information and in the process of data collection (internet, questionnaire and interview).
Time constraint- The researcher will simultaneously engage in this study with other academic work. This consequently will cut down on the time devoted for the research work.
1.9 Definition of Terms
Coronavirus (COVID-19): it is an infectious disease caused by a new virus. The disease causes respiratory illness (like the flu) with symptoms such as a cough, fever, and in more severe cases, difficulty breathing. You can protect yourself by washing your hands frequently, avoiding touching your face, and avoiding close contact (1 meter or 3 feet) with people who are unwell.
Economy: is the large set of inter-related production, consumption, and exchange activities that aid in determining how scarce resources are allocated. The production, consumption, and distribution of goods and services are used to fulfill the needs of those living and operating within the economy, which is also referred to as an economic system.
Pandemic: A pandemic is a global disease outbreak. It differs from an outbreak or epidemic because it: affects a wider geographical area, often worldwide; infects a greater number of people than an epidemic.