SOME GOOD NEWS

Early signs of a reviving economy

There will be no easy path to revival.

In Summary
  • First, the flower growers of Naivasha and elsewhere have begun to send flowers to Europe again.
  • Second, those 20km long queues of trucks stretching from the Kenya-Uganda border at Malaba.

There have been two signs of economic activity which must count as really good news to those here in Kenya, who worry about the economic repercussions of the coronavirus pandemic.

First was that the flower growers of Naivasha and elsewhere have begun to send flowers to Europe again. This may seem rather sooner than expected, but it was never really cargo planes which were grounded. Those are not what are to be feared at this time when everything is being done – in every country – to slow down the spread of the dreaded coronavirus. It is planes disgorging hundreds of passengers, each with their own recent travel history, which would carry the threat of widespread infection.

Indeed, ships had not stopped plying the seas either, all this time. Coffee and tea exports have continued, albeit not on the same scale as before. These are goods which can be temporarily stored in warehouses, awaiting either improvements in market prices, or availability of container ships.

 

And although the Kilindini port in Mombasa seems to have been a hotbed for Covid-19 infections, modern container ships do not require exceptionally large crews either. It is the cruise ships that Kenya has gone to great lengths to attract to our shores which have proved to be dangerously prone to providing a breeding place for the coronavirus.

Indeed, one cannot help feeling sorry for the technocrats at our Ministry of Tourism and its associated support organisations. They have worked so hard, and for so long, to persuade cruise ship owners that the East African coast is no longer infested by pirates operating out of Somalia. And just when they were beginning to succeed, along comes the coronavirus to absolutely crush global cruise ship bookings.

That aside, mention of those container ships brings me to the second piece of good news: those 20-kilometre long queues of trucks stretching from the Kenya-Uganda border at Malaba.

At this time when we are constantly warned that the economic consequences of the coronavirus pandemic are possibly going to be even more devastating than the pandemic itself, it is some consolation to see that business with Uganda continues as usual.

Those exceptionally long queues are no doubt a great inconvenience to truck drivers and their employers, but they are also a reminder of two things. First that although our attention tends to focus on the trading activity between Kenya and China or the European nations when the economy is discussed, our most significant trading partner is actually Uganda. Second is that not only do Ugandans consume many goods produced by Kenyan businesses, but we also serve as the indispensable gateway for most of the goods being imported into Uganda.

In ordinary times, few would give any thought to the question of how many trucks ply the Kenya-Uganda route every day. But at this time when we are constantly warned that the economic consequences of the coronavirus pandemic are possibly going to be even more devastating than the pandemic itself, it is some consolation to see that business with Uganda continues as usual.

However, transport of physical goods is one thing. The service sector is far more complicated. Whether you talk of the hospitality sector (ie tourism and travel) or academia (the many private schools and universities in Kenya that have a substantial enrolment from Uganda, as well as other African countries) – there will be no easy path to revival.

At the moment, both Uganda and Rwanda are considered to have done much better at slowing down the rates of Covid-19 infections, than Tanzania and Kenya. Tanzania in particular – apparently laying all its anti-Covid-19 bets on some herbal concoction being produced in Madagascar – is the country likely to suffer the longest and most devastating effects of the pandemic. This can only mean that the borders between Kenya and the other East African nations will not open anytime soon.

 

Of course, this cuts both ways: there is a very impressive enrolment of Kenyan students in Ugandan high schools and colleges, with some private colleges having so many Kenyan students that Kenyan currency is freely used at such institutions alongside the Ugandan currency.

Not only will those Kenyan students not be returning to Uganda anytime soon, but they may well end up resuming their studies right here in Kenya if the border is still closed when Kenyan schools and colleges reopen.