Cash scarcity crippled Nigeria’s economy, says UN

The shortage of the naira in recent times crippled 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 UN 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.

UNCTAD said, “In Nigeria, a shortage of cash, triggered by the replacement of the highest denominations of the country’s currency, hobbled the economy, especially the informal sector.

“Meanwhile, the continuing decline of oil production, accompanied by large-scale oil theft, poses a main threat to strained finances in Africa’s most populous nation.”

According to the organisation, the general African economy is projected to expand 2.5 per cent, which is a drop from last year, and insufficient to curtail poverty levels on the continent. It explained that this is in no thanks to weaker external demand and tighter financial conditions.

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.

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