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World Bank Warns against Increase in Poverty in Nigeria Due to Decline in GDP

The World Bank has raised the alarm that, as Nigeria’s Gross Domestic Product (GDP) declines, poverty will be on the increase.

This is contained in the Nigeria Economic Update (NEU) report released by the global financial institution in Abuja on Monday.

The report said: “With economic growth expected to remain below the estimated population growth of 2.6 per cent through 2021, per capita real GDP will decline from $2,485 in 2018 to $2,460 by 2021, pushing more Nigerians into poverty.”

“Population growth is expected to continue exceeding economic growth, undermining Nigeria’s prospects for poverty reduction,” it stated.

The report also revealed that money in the Excess Crude Account (ECA) had almost “ been exhausted, rendering Nigeria more vulnerable to shocks.”

The NEU report stated that “the account balance on June 30 was $0.1 billion, down from $0.6 billion at the end of 2018 and $2.5 billion at the end of 2017.”

The World Bank lamented that the “ECA has rarely operated as envisaged; when it was established in 2004.” It explained that that the account “was to be drawn on only when the actual crude oil price falls below the budget benchmark price for three consecutive months.”

State governments challenged the creation of ECA on the grounds that the Federal Fiscal Responsibility Act (FRA) of 2007 was not binding on them and local governments.

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