Macro Analysis /

Nigeria: Life during the lockdown

  • 238 confirmed cases, 35 recovered, 5 deaths as at 6 April 2020. Lagos, FCT and Ogun in day 8 of 14-day shutdown

  • Overall economic slowdown with expected loss in revenue as oil contributes 45% to total government revenue

  • Sector impact: positive for some Consumers, negative for Banks and Industrials

Nigeria: Life during the lockdown
Nkemdilim Nwadialor
Nkemdilim Nwadialor

Equity Research Analyst, Financials

Tellimer Research
7 April 2020
Published byTellimer Research

Nigeria is currently in the middle of a 14-day lockdown, which began on 31 March 2020. The lockdown which was declared by President Buhari has resulted in the shutdown of all economic and social activity within the Lagos, Ogun and the Federal capital territory (FCT). Essential services like hospitals (including clinics and pharmacies), healthcare-related manufacturing, food processing, petroleum distribution, essential media and telecommunication services are exempt from the shutdown.

Figure 1: Nigeria Covid-19 cases – Infections, recoveries and deaths

Source: Nigeria Centre for Disease Control (NCDC)


Table 1: Nigeria regional Covid-19 stats
States Geopolitical zoneNo. of Cases


South West



North Central



South West



South South



South West



North East


Akwa Ibom

South South



North West



South West



South East



South West



North Central



South South



North Central



South West


Source: NCDC

The shutdown, which was enacted to slow the spread of Covid-19 within the country, has been slightly chaotic with reported incidents of police or military brutalityrising food prices and large volumes of failed digital banking transactions.

The lockdown has been widely criticised as hastily planned as it failed to make provision for the welfare and social protection of the most vulnerable population who largely rely on daily incomes for sustenance. 

Market performance during the lockdown

The decline in oil price, as well as the slowdown in economic activity due to the pandemic, puts pressure on Nigeria’s revenue and productivity as oil sales account for c45% of Nigeria’s revenue and 90% of its export earnings. 

The equities market is down 23% ytd, mostly due to losses in large-cap stocks in the Industrials and Oil & Gas sectors. The Naira continues to depreciate despite a decline in foreign exchange demand due to lower economic activity and travel restrictions.

On the fixed-income side, there has been a slight increase in market liquidity driven by corporate issuance as well as the OMO market. However, we expect investor participation to remain limited due to the lockdown. 


All banks are closed within Lagos, Abuja and Ogun during the lockdown, and as a result there has been a significant uptick in the use of digital and other alternative banking channels. However, this pick-up in volumes might not be sufficient to offset the lower fees that these transactions typically incur.


Local supermarkets are reported to be limiting the number of customers allowed into stores at any one time to ten, and have started offering delivery services using WhatsApp. They also report that the most demanded products are canned/frozen products and household essential products such as tissues, toilet paper and soap.

Online grocery outlets such as Pricepally and Easyshop Easycook Services (who had to temporarily halt their website due to the high volume of orders) have recorded massive increases in orders, which in turn have caused the price of food to increase, especially for consumer staples such as rice, beans, tomatoes, yam, pasta etc.

Over-the-counter pharmaceutical goods are also experiencing increased demand. A recent example being the surge in the purchase of Chloroquine – the anti-malaria drug – after US President Donald Trump alluded to its effectiveness in treating Covid-19. Local pharmacies we spoke to report that prices have skyrocketed by 400% due to the increased demand, with the more affordable brands now retailing for cNGN1000 (cUS$3).


Most industrial companies are currently closed, with the exemption of petroleum-related companies and Dangote Cement. 

Oil companies are hurting on two fronts, as lower oil prices have combined with decreased production. Even with the use of hedging strategies which typically cover 20-40% of production, revenues are expected to be weak.

Cement players are expected to experience decreased demand on account of lower infrastructure spending (the government has cut capital expenditure for 2020 by 20%) as spending is diverted towards healthcare development (government) and consumer goods (households), which could prompt them to offer discounts on their products. 

While we expect some improvement in operating expenses due to lower energy costs, this might not be enough to offset the lower demand and lower prices.

Other developments

Despite the general downturn in economic activity, Gradely, an artificial intelligence-enabled educational tool that gained prominence in Nigeria as the pandemic outbreak caused the closure of schools, has secured an investment of US$25,000 from Microtraction – a venture capital investor that identifies unique African tech companies in need of early-stage funding.