The Federation for Small and Medium Enterprises Uganda (FSME) has asked government to be proportional in its response to the Coronavirus health scare so as not to negatively affect consumer demand and worsen the already bad situation for small businesses.
The executive Director FSME, John Walugembe says although government needs to take all the necessary precautions to prevent the spread of Coronavirus, it should be mindful so that it does not create a state of fear and despondency that will hurt the business community.
This comes at a time when Uganda is waiting for an emergency address from President Yoweri Museveni this evening.
It has been speculated that the president may order for suspension of all public meetings, closure of schools and houses of prayer and also compelling some people to work from home.
“If that is true, the economy will come to a standstill and the most affected will be the small businesses. Our recommendation is that while the President may take such precautions, the implementers must put in consideration the fact that most Ugandans live from hand to mouth. If they are stopped from working, their families will have no way of surviving and may end up starving before Corona Virus reaches here. Our recommendation is that they allow businesses to take precautions like putting hand washing materials at their premises and increases use of sanitizers,” he said.
The federation also wants government to boost the liquidity of small businesses by putting in place an emergency low-interest fund from which small businesses can borrow and meet their working capital and operational requirements.
“The Central Bank should slash interest rates to spur lending to the private sector. Government can also offer tax reliefs to businesses by lowering the VAT rates for about six months. We are not saying that government should give hand-outs to businesses but create an environment that allows businesses to survive the Crisis until things get back to normal,” Walugembe said.
He further urged the business community to be innovative and take advantage of the high demand for the sanitation products.
“If you have been importing clothes and now the supply has been cut off, go into manufacturing sanitizers, face masks, liquid soaps as you wait for the situation to get back to normal,” he said.
Since its outbreak in December 2019 in Wuhan China, Corona Virus (COVID 19) has so far affected 195,000 people worldwide, killed 7,900 and affected 160 countries. According to Ministry of Health, Uganda has not registered any case of Corona Virus yet, however, like any other country, it is on high alert as its neighbours like Kenya, Tanzania, Rwanda, Congo have been affected.