COVID-19 PANDEMIC AND NIGERIA’S ECONOMIC GROWTH: A COMPARATIVE ANALYSIS OF PRE AND P0ST 2020

Abstract

The outbreak of covid-19 pandemic affected the global economy, Nigeria inclusive. As a result, economic forecasts predicted a global recession for the year 2020 and possibly beyond. Hence, this study aims to examine the extent to which covid-19 pandemic has affected the growth of the Nigerian economy by doing a comparative analysis of pre and post 2020 covid-19. Monthly time series data was employed from the period January 2018 through October 2022. The model specified used real gross domestic product as the dependent variable while the regressors were agricultural output, industrial output and services sector output. Covid-19 was used as an economic growth interruption variable rather than a real quantitative variable and its effect in the model was evaluated using the Chow break-point test. The stated hypotheses were tested using the t-test, F-test and coefficient of multiple determination (R2). Other tests conducted were stationarity test and the ARDL Bounds test for co-integration. The Chow test revealed that structural break existed at the specified break point period of May 2020. Hence, we estimated the model parameters before and after the break-point period. The result revealed that the agricultural sector increased real GDP significantly before and after the month of May 2020. The industrial sector’s output was positive but not significant before the pandemic, it became significant after the pandemic. The services sector did not significantly increase real GDP before the pandemic, but afterwards, the sector’s contribution to GDP slipped to negative. The study concluded that the Nigerian economy has obviously been largely affected by the covid-19 pandemic with the services sector being highly affected. It was recommended that government should make deliberate favourable policies that will further enhance the agricultural and industrial sectors output and that the government should serve as encouragers in the services sector as this will make young entrepreneurs to invest more in myriads of services available in the services sector in this period of post covid-19 recovery.