What Ugandan businesses and economy should laud COVID-19 for.
The covid-19 pandemic is currently causing a notable adverse impact on the global economy. Every government is implementing various measures to mitigate its effects and provide relief for businesses and households. Within East Africa, the impacts of Covid-19 are being felt differently and a number of measures have been implemented by the territorial governments with a common focus to contain the spread of the virus and ensure the sustainability of their economies.
In Uganda, different measures being implemented range from monetary, fiscal, and non-fiscal measures. The latter relates mostly to aspects of social distancing which comprised components like; partial lockdown of the economy, closing up places of worship, nightclubs, and bars, highly risky businesses such as hotels, arcades, and shopping malls, saloons, public transport, among others. The non-fiscal measures affected mostly the service sector; notably the aviation, tourism, and hospitality industry. The key fiscal and monetary measures adopted include increasing the health ministry’s expenditures, reducing the central bank rate, and providing other credit relief measures respectively.
The short-run macroeconomic effects of these measures on the economy have been general reductions in domestic consumption, domestic and foreign investments, government spending, government revenues, exports, and imports, and increased pressure for and dependency on government relief.
“Other than those adversities, what smile has this pandemic brought to Ugandan Businesses and economy as a whole? Among others, the pandemic has brought opportunities to businesses including emergence of new work methods, capitalisation of Uganda Development Bank, boosted social economy, projected increase in agricultural productivity as highlighted below”;
Uganda has experienced a remarkable social economy for the first time. Many corporate companies, Ugandans, and Non-Ugandans have donated to the Covid-19 National Tasks Force and to individuals to support government efforts toward containment of the virus spread and other disaster relief.
Government’s extra miles – Covid-19 has impacted economies differently. Several developed countries attained sustainability through manufacturing their own products to reduce reliance on imports. The government world over has provided funds to boost businesses including direct financial and other support to the people. The capitalization of the Uganda Development Bank is among the efforts government of Uganda has applied to support investors’ access to credit facilities to boost business at low-interest rates. Empowering manufacturing and agriculture will promote self-sustainability in the long run.
The emergence of new work methods: Although some employees have lost jobs, there are sectors where employees have been given more control and trust to manage their own schedules while working from home during the lockdown. There has been increased use of technology to coordinate work online, most businesses have now appreciated the use of e-mails, zoom technology, video conferencing, etc. compared to physical meetings. These best practices will need to live on and businesses should develop new muscles to work virtually.
By: Okot Leonard