Nigerian budgetary response to the COVID-19 pandemic and its shrinking fiscal space: financial sustainability, employment, social inequality and business implications

Abstract

Purpose

This article aims to explore the Nigerian government's budgetary response to the COVID-19 pandemic as well as the economic and social implications of the pandemic response.

Design/methodology/approach

Our analysis is based on a review of secondary evidence such as Nigerian Federal Government budget documents, policy documents, Central Bank of Nigeria circulars, news media articles, World Bank and International Monetary Fund reports, reports from Big Four accounting firms and policy think-tanks.

Findings

The authors highlight how increased borrowing to fund COVID-19 related economic and social interventions have significantly squeezed Nigeria's fiscal space. The authors also highlight that while some interventions provide short-term economic relief to the poor and small businesses, other interventions and gaps in the policy response have the potential for significant negative impact on businesses, households and unemployment. In addition, the authors highlight the potential for long-term benefits to the health sector and for private sector engagement in corporate responsibility and philanthropy.

Originality/value

The authors present a comprehensive account of the Nigerian government's budgetary response to the COVID 19 pandemic and the economic and social implications of this response.

Citation

Ejiogu, A., Okechukwu, O. and Ejiogu, C. (2020), "Nigerian budgetary response to the COVID-19 pandemic and its shrinking fiscal space: financial sustainability, employment, social inequality and business implications", Journal of Public Budgeting, Accounting & Financial Management, Vol. 32 No. 5, pp. 919-928. https://doi.org/10.1108/JPBAFM-07-2020-0101