The shortage or scarcity of the naira notes in recent times impaired the Nigerian economy, the United Nations has disclosed.
It stated that the informal sector felt the brunt of the scarcity the most. It noted that the continuing decline of oil production is set to impact the country’s finances in 2023.
The United Nations disclosed this in its ‘Trade and Development Report Update; Global Trends and Prospects (April 2023),’ report produced by the United Nations Conference on Trade and Development.
During the conference the humanitarian organization representative said, “In Nigeria, a shortage of cash, triggered by the change in design and replacement of the highest denominations of the country’s currency, crippled the economy, especially the informal sector.
“Meanwhile, the continuous decline of oil production, accompanied by large-scale oil theft, poses a main threat to strained finances in Africa’s most populous nation.”
It noted that many African economies are at risk of stagflation in 2023, with half of African countries recording double digit inflation in early 2023.
According to the humanitarian organization, the general African economy is projected to expand at 2.5 percent, which is a drop from last year, and not enough to curtail poverty levels on the continent. It explained that this is in no thanks to weaker external demand and tighter financial conditions.
“Public debt, in many cases standing at levels not seen since the early 2000s, is another worry across the continent. Out of the 38 African countries that are part of the Debt Sustainability Framework of IMF and World Bank, 8 entities are already ‘in debt distress’, while 13 are considered ‘at high risk’ of distress.”
Recently, the UN revealed that the Nigerian economy will grow to three percent in 2023 due to its commodities trade and consumer goods and services markets.
Leave a Reply