Nigerians may need to brace up for harder times as the Governor of the Central Bank of Nigeria, Godwin Emefiele, may have made some gloomy revelations about the country’s economy.
The CBN governor, in a closed-door meeting with the Senate, disclosed that the Federal Government might not be able to pay its workers’ salaries, effective from October this year if the current economy decline continues.
Emefiele further stated that if the present situation in the country continued, Nigerians would be forced to pay general taxes, which would not exclude petroleum products.
In the meeting, Emefiele presented a comprehensive account of the economy in the last one year which he said not in a good state.
Yesterday, the IMF slashed its growth forecast for the Nigerian economy this year
, saying a combination of plunging oil revenues and weakened investor confidence will push it into recession.
The International Monetary Fund said it expects Africa’s largest economy to contract by 1.8 percent this year, after having forecast in April a 2.3 percent expansion.
Nigeria’s stall, and sluggish activity in the number two economy, South Africa, is expected to pull down economic growth across sub-Saharan Africa, the IMF said, forecasting a “dramatic implication.” “In 2016, regional output growth will fall short of population growth, implying declining per capita incomes,” it said.
Nigeria’s economy has been battered hard by the plunge in oil prices, the main source of the country’s income, as well as prices of other key commodities.
In addition, rebels in the southern oil region have forced crude production cutbacks, and internal unrest, especially attacks by the Boko Haram group in the north, has also hurt the economy.
Inflation hit an 11-year high of 16.5 percent in June as prices of food and energy jumped after the government freed up the naira currency in April, allowing it to plummet against the US dollar.
Also weighing on output have been electricity shortages due to rebels’ sabotage of the gas pipelines that fire power plants.
