COVID’19 Pandemic and Nigeria Economic Growth: A Time Series Analysis

Resumen

The COVID-19 pandemic caused an unprecedented global health and economic crisis, forcing governments to implement restrictive measures that severely impacted global trade and economic activities.
Purpose: Sustainable economic growth, measured by the increase in a country’s Real Gross Domestic Product (RGDP), is the bedrock of development. This research employs a time series analysis to quantify the impact of the COVID-19 pandemic on Nigeria's economic growth, measured by Real Gross Domestic Product (RGDP), over the period from January 2019 to December 2021. The study also examines its simultaneous effect on Ship Financing (credit to the private sector) as a critical indicator of maritime sector activity and broader economic health.
Design/Methodology: The analysis utilizes quarterly secondary data from the Central Bank of Nigeria (CBN). Econometric techniques were applied to test the relationships at the 5% significance level.
Findings: The econometric results reveal a negative and statistically significant impact of the COVID-19 pandemic on both Nigeria’s economic growth (RGDP) and the volume of ship financing during the study period.
Limitation/Policy Implication: A 1% rise in CVID (COVID-19 cases/severity) will lead to a +0.002392% rise in RGDP (economic growth), four quarters later. This result is positive and statistically significant.
This is a highly counter-intuitive finding, as immediate economic theory suggests a negative relationship. The positive coefficient for the lagged CVID (-4) does not mean the pandemic was good for the economy; rather, it suggests the Bounce-Back Effect. It likely captures the delayed V-shaped recovery.
Originality: The study advocates for developing robust national economic strategies that promote diversification and domestic resilience to shield the GDP from future global health or economic emergencies, aligning with the principles of Modern Portfolio Theory.