The fall in global oil prices occasioned by the COVID 19 pandemic has been projected to cost Nigeria and other African oil exporters an estimated $34 billion in revenue, the International Monetary Fund (IMF) has revealed.
IMF further projected that African governments would be under intense budget pressure and rise in debt burden, adding that such a burden would be higher among oil-exporting countries.
Abebe Selassie, IMF’s director, African Department, made this stunning disclosure at the Africa ministerial roundtable on COVID-19 impact on the energy sector in Africa.
“The shock is certainly crippling fiscal resources in the short run, but it should not be allowed to wipe out the achievements in terms of human development over the last two decades,” says Selassie.
He added, “The recovery on the continent depends crucially on investing in renewable energy which offers huge potential in terms of badly needed jobs and acquiring new technological capabilities.
“It would also help fight climate change and power the development of Africa.”
The IMF noted that since the 2014 oil price collapse, production and investments of most African oil exporters had been on the decrease.
The institution blamed the decline on structural issues, governance, and security concerns in several countries, especially in Nigeria and Libya.