According
to the CBN, crude oil price has risen to $42.94per barrel, a 33 percent
rise compared to $32.25 per barrel in the previous month.[i]
The rise comes just as many economies are reopening, recording a marginal
increase in demand. However, world oil demand is still expected to drop by 9.1
million barrels per dollar.[ii] OPEC and its member countries have agreed to
drop oil production in order to control market supply and consequently price.
With this agreement, the revenue gains from increasing oil price for Nigeria
could be marginal as the country is expected to cut production by about 22
percent to 1.4 million barrels per day which may also hinder the realization of
the revised 2020 budget considering that the crude oil production estimate is
1.7 million barrels per day. To ensure performance of the 2020 budget,
concerted efforts must be in place to ensure optimum collection of non-oil
revenues by blocking leakages and non-remittances through improved administrative
and monitoring mechanisms.
July 14, 2020
Nigeria Economic Update (Issue 25)
Related
The Chinese Model Of Infrastructure Development In Africa
Infrastructural
development is a key step in providing a competitive business environment for
African economies. It provides the backbone for poverty reduction strategies
and programmes designed to improve the livelihood of the poor. Africa is in
dire need of infrastructural development. The absence of quality infrastructure
in the continent holds back per capita economic growth by 2 percentage points
each year and depresses firm productivity by as much as 40 percent (Escribano
et al., 2008 and Kelly, 2012). Estimates suggest that around USD 90 billion is
required to close Africas infrastructure gap annually until 2020 (AICD, 2010).