The COVID-19 outbreak, which has been spreading rapidly, has come with a devastating global impact. This coronavirus pandemic has become a global threat, increasing from 197,590 infections and 7,954 deaths in March 17, 2020, to 2,350,075 infections and 161,270 deaths as at April 19, 2020—barely a month.
The bid to contain the spread of the coronavirus disease has led to lockdowns and travel restrictions across countries globally, with Nigeria also being affected.
The lockdown directives have led to the shutdown of many businesses, especially those that cannot be performed from homes. Only businesses proffering essential services have been exempted from the lockdown directive; hence, the nation’s economy is adversely affected.
While speaking yesterday during a live webinar presentation organized by FCMB Plc on the topic, “COVID-19 and Economic Downturn Response,” Nairametrics’ Founder, Ugochukwu Obi-Chukwu, listed a couple of sectors that will be negatively impacted by the outbreak.
Some of those listed sectors, which are very critical to the economy, include:
Tourism and Aviation: This has been one of the hardest-hit sectors, as the lockdown and travel restrictions have caused a huge slump in demand among travellers. Most of the local and foreign airlines have suspended operations, with all the airports under a shutdown order by the Federal Government. As of March, the International Air Transport Association (IATA) had reported an estimated revenue loss of $252 billion in the sector globally.
Hospitality Industry: It is no secret that the hospitality industry is one of the sectors that have been hit the hardest by the COVID-19 pandemic, with many of the employees either out of work or losing hours due to travel restrictions, the shutdown of businesses, and social distancing. The hotels have been experiencing very low patronage.
Cinemas and Entertainment: The film and entertainment industry, in general, has experienced substantial negative impact; movie theatres have been shut down, art exhibitions, movie premiers and musical concerts have either been cancelled or postponed. In fact, multi-billion naira worth of deals has been lost in the sector.
Oil and Gas Industry: The sector has been badly hit by the pandemic, since the lockdown and travel restrictions have led to a huge drop in oil demand and crash in crude oil prices globally. Even the intervention of OPEC+ and top oil-producing countries through output cut has still not impacted on oil prices or stabilized the market.
Real Estate and Construction: With the drop in income and loss of jobs, very little interest in acquiring houses will be shown by property buyers. Also, the movement restrictions and social distancing will adversely affect construction activities nationwide with organizations and individuals trying to apply safety measures.
Trade: This will be negatively impacted, owing to the shutdown of factories, reduced access to raw materials and commodities due to supply chain challenges. Trillions of naira worth of trade for both imports and exports will be lost due to the lockdowns, seaports and border closure. As China, is crucial to global trade with its current integration in the global value chain and main supplier and buyers of intermediate inputs, the disruptions it is dealing with due to the disease will affect trade.
Manufacturing: The disease will impact negatively on the manufacturing sector, as production lines and factories will be shut down due to the lockdown and low consumer purchases.
Start-ups and Small businesses: entrepreneurs are forced to take drastic steps in order to remain in business. The preventive measures taken by the government have left startups as one of the most vulnerable.
Consultants and Services: Consultants and service providers will be negatively affected, as the drop in revenue by companies and even government institutions due to the economic meltdown will lead to tightening of budgets which will negatively affect the consultants.