• According to the biannual Africa’s Pulse World Bank report, economic growth in sub-Saharan Africa will decline from 2.4 per cent in 2019 to between -2.1 per cent and -5.1 per cent this year.
• In other words, the report predicts that the continent will experience its first recession in 25 years.
Global trade has taken a major blow in the wake of the Covid-19 pandemic.
The rates of imports and exports have tremendously dropped in every country in the world. According to the World Trade Organization, global trade is expected to fall by between 13 per cent and 32 per cent this year as the virus pandemic disrupts normal economic activity and life
Individually and collectively, countries are trying their best to contain the spread of the virus. Unfortunately, the virus is rapidly spreading and this continues to pose a threat to economies as most countries are either on a total or partial lockdown.
According to the biannual Africa’s Pulse World Bank report which was released in the second week of April, economic growth in sub-Saharan Africa will decline from 2.4 per cent in 2019 to between -2.1 per cent and -5.1 per cent this year, depending on the success of measures taken to mitigate the pandemic’s effects. In other words, the report predicts that the continent will experience its first recession in 25 years.
Kenya currently has over 2,000 confirmed C0vid-19 cases. With the continued increase in the cases, the economy continues to suffer greatly. The rate of imports in the country has gone down and as a result local businesses continue to suffer.
Statistics by KenTrade’s Single Window System show there has been a notable decrease of over 50 per cent in the number of permits applied for importing various commodities between January and April this year as compared to a similar period last year.
Most businesses are very dependent on imports. I recently spoke to a few businessmen and women who rely heavily on imported goods to make ends meet. According to their testimonies, there is no shred of doubt that the rate of imports has reduced. As such, products have become scarce and more expensive. Business has gone down since traffic of people and flow of money has reduced. This is currently the case for most business people in Kenya.
With this kind of downward spiral on business, it is important to rethink your strategy to ensure businesses stay afloat during this pandemic. Here are a few tips;
Go local. Flow of goods in the country has gone down due to the import and export challenges and restrictions. As a result, delivery of goods by suppliers has been impaired, made slower and/or their ability to get those supplies to you has been restricted.
In such a scenario, one should strongly consider setting up alternative suppliers, including local suppliers even if more expensive. My conversation with a businessman confirmed that this is the way to go. Martin runs a clothes store and he depends on imports for his business. With the Covid-19 restrictions, his business has been greatly affected by the current import bans. He, however, has decided to go local and is currently custom making clothes and selling them online.
Cut on your spending. With the current strain in finances, it would be important to make tough yet essential decisions for your business. Saving money is vital to ensure your business stays afloat. You can do this by working from home or online instead of paying rent for your office or work space.
Go online. With the rise in technology, many things are done online. Invest in the online growth of your business. Create a website if you do not have one as well as social media pages. Grow your online presence and conduct your business there. Work on the kind of content that you present to your audience. Let it be re-assuring, encouraging and enlightening.
Plan ahead. A wise business person plans ahead. If your business revolves around importing and exporting, this is not the time to close shop or give up on your business. Though a lot has been affected by the pandemic, remember that no situation is permanent. The pandemic will end. Ask yourself where the end of this pandemic will find you.
KenTrade provides step by step processes on importing and exporting. Take this time to familiarise yourself with all the processes and all requirements to import so as to grow your business.
Through it all, let us remember that failing to plan is planning to fail. We shall overcome!
Public relations professional