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Since Patrick (Ebola) Sawyer, the Liberian-American imported the dreaded Ebola Virus Disease (EVD) into Nigeria on July 20, this year, the battle to contain the epidemic has not only posed a serious challenge for government and health workers, it has equally taken its toll on the Nigerian economy.
In addition, it has drastically changed lifestyles in Nigeria. The dead are no longer celebrated. They are buried where they died. The first four casualties of the virus did not get the euphemistic “befitting burial”. Their funerals were attended only by health workers in protective clothing. No large gatherings, no parties, no expensive coffins.
Nigeria, Africa’s biggest economy, has recorded 19 cases of the virus, and seven people have died within its borders. The economic cost of EVD in Nigeria is enormous. There are indications that patronage of hotels and restaurants in Lagos has dropped by 50 per cent. Airlines have also been complained about low patronage. Some airlines have cancelled their daily flights to the west coast with huge losses in revenue. Stranded passengers are in dilemma.
Since medical experts have recommended washing of hands with sanitiser as one of the protective measures against EVD, the demand for the product is high. Consequently, the price of hand sanitiser has gone up from N250 to about N600 while the big bottle goes for as much as N2000 to N3000. While the pharmaceutical and retail medicine shops are making brisk business from the Ebola scare as scare-stiff Nigerians troop to buy sanitisers and other medical equipment that could prevent the spread of the disease, a larger part of the economy is experiencing declining revenue.
The August 2014 edition of Financial Derivatives Company report on the Nigerian economy illustrates the immediate and potential aggregate economic impact of the outbreak of the Ebola disease in Nigeria. According to the report, the sectors that have been impacted the most in Nigeria are aviation, hospitality and tourism, trade, medical and agriculture.
The report which analysed the contributions of these to the Gross Domestic Product (GDP), noted Nigeria might lose about $2 billion in the first quarter of the outbreak.
In the same vein, global rating agency, Moody has announced that the outbreak of Ebola in Nigeria could lead to serious disruptions in some sectors of the economy with negative financial consequences.
The president of Lagos Chamber of Commerce and Industry, (LCCI) Remi Bello, said the fear of the disease has affected economic activities. He also identified the sectors of the economy which have been affected most as aviation, tourism and hospitality, trade, medical and agriculture.
Bello urged the business community and the entire citizenry to support the current efforts at containing the disease. He noted that there is currently the risk of international isolation, stigmatization and unwarranted discriminatory practices against the citizens travelling outside the country’s shores. This has grave consequences for the economy and the citizens.
In the aviation sector, EVD has led to the dwindling of the revenue accruing to airlines which operate in the West African coast. Captain Ado Sanusi, deputy managing director and head of flight operations of Arik Air, said the cancellation of flight operations to West Africa by airlines would have negative economic impact on the revenue of the airlines as well as the economies of the affected countries. “Economically, it will have very bad impact. You remember SARS outbreak in the Far East and the impact on small airlines. In fact, some airlines had to go under and some had to seek government support. If Ebola is not controlled, it will lead to the same situation,” Sanusi said.
Captain Sanusi said he cannot put figures to Arik’s cancellation of flights to Liberia and Sierra Leone but noted that it is losing a lot of revenue. “We are losing revenue because of daily flights. We have about four flights to Liberia and about three flights to Freetown (Sierra Leone) and we were connecting Ghana with Freetown. We were also connecting Ghana with Monrovia and Banjul, so there are a lot of economic activities that are going on within the West African countries, which now is not being done. Of course, there will be economic loss there as movement will be restricted.”
Like the aviation industry, the tourism and hospitality industry has equally been receiving low patronage since the outbreak of Ebola. Indeed, EVD outbreak in Nigeria has whittle down tourism and reduced the influx of tourists coming into the country. Already, many standard hotels have devised measures to reassure guests that their protection would be guaranteed by ensuring that all necessary safety measures are taken while sanitation has been increased.
There are also indications that Ebola outbreak has affected the financial markets. David Adonri, a general manager with Highcap Securities Limited, said Ebola outbreak has slowed down commercial activities in the economy and may reduce quoted companies’ corporate earnings. He added that this would adversely affect both domestic and foreign investments, saying that the outbreak must be arrested at all cost.
In the banking industry, banks and other corporate bodies are taking precautions to protect their staff and customers especially in Lagos where the deaths are being recorded. Some banks now screen customers as they enter the banking halls using infrared thermometers, while others have customers apply hand sanitisers at the entrance of the banks. At the entrance of some banks, security men stand with shotgun-looking infrared thermometers, pointing it in the faces of customers before going into the banking halls. One of the security personnel in one of the banks said that the essence of using the infrared thermometer was to determine if a customer or potential customer is infected with the deadly virus.
Perhaps, the hunters and those involved in the sale of bush meat are the worst hit. There have been reports on drop in the sale and consumption of bush meat across Nigeria following the Ebola outbreak and the attendant control campaigns that warn people to desist from consuming it. Bush meat sellers said that they are witnessing drop in patronage in the business due to the disease. The president of the Association of Animal Hunters of Nigeria (AAHON), Comrade Ray Macaulay recently decried the drop in the sale and consumption of bush meat across Nigeria following the Ebola outbreak. He was of the view that if animal connection is to be considered, the most reasonable and scientific would be only the domestic animals that inhabit environments where human wastes and living habits are deposited not the animals in the forest.
Despite the anxiety among business communities over the economic cost of EVD, Dr. Ngozi Okonjo-Iweala, Minister of Finance and Coordinating Minister of the Economy insists that it has not seriously affected the Nigerian economy. “We have a team monitoring the economic impact and we don’t feel we are yet at the point where we can say it’s having a huge impact on the economy,” Okonjo-Iweala said. She, however, admitted that “there’s been some fall-off in hotel occupancy, in Lagos in particular, some meetings have been postponed, but you still have other business people who are arriving.”
Interestingly, Nigeria appears to have effectively contained the scourge. At the time of filing this report, there was no case of any Nigerian still afflicted by EVD as all those who were quarantined have been discharged. The Minister of Health, Prof. Onyebuchi Chukwu, has assured Nigerians that the Federal Government was in control of the situation. “I can assure you that the disease has been covered. People should not cause panic,” he said.
Nigeria’s efforts to contain EVD received a boost on September 16, when it received a $1million grant from the African Development Bank (AfDB). Dr. Okonjo-Iweala said at the signing ceremony for the grant that the “event is about the partnership of countries and institutions to support Nigeria’s successful efforts to contain Ebola.” She explained that Nigeria has done well as confirmed by the World Health Organisation (WHO).
The AfDB Country Representative in Nigeria, Dr. Ousmane Dore, said the bank decided to “strengthen relevant institutions and response mechanisms in the battle against Ebola.”
The WHO Country Representative, Dr. Rui Gama Vaz, said the international health organisation appreciates the efforts made by Nigerians to tackle Ebola. According to him, the results have been impressive. “We know the leadership of President Goodluck Jonathan has been a decisive factor. Ebola is an international issue, which requires international response. The federal, Lagos and Rivers governments have done quite well in terms of quick response and allocation of resources,” he said.