ADDIS ABABA – The government should come up with an alternative and urgent measures than closing businesses to rescue the economy from collapse in the effort to contain COVID-19, advises Kebour Ghenna, Executive Director of the Pan African Chamber of Commerce and Industry (PACCI).
Kebour Ghenna told The Ethiopian Herald the closure of businesses is not the best option as it would have a severe impact on the economy.
“Closure of businesses will drag the country into endless economic crisis unless other options are sought by the government,” he said.
The government has to come up with various intervention mechanisms and support businesses and industries. Particularly, there is a need to stimulate domestic economic activities, he added.
The effort to alert the public to prevent the spread of the disease needs to also be intensified.
It is to be recalled that the COVID-19 Ministerial Committee’s macro-economic sub-committee has been undertaking dialogue with key industry stakeholders in various sectors to craft a way forward in safeguarding the economy.
A decision was reached for National Bank of Ethiopia to avail Birr 15 billion liquidity for private banks to enable them to provide debt relief and additional loans to their customers in need and banks to avail foreign currency for importers primarily importing goods and input material for the prevention of COVID-19.
The Ministry of Trade and Industry has also continued strengthening the measures it is undertaking to control price increments and supply shortages of consumer goods.
Recently, the World Bank warned governments to ease restrictions.
Many countries have canceled flights, closed borders and ordered their people to leave the country. This has placed a heavy strain on the world economy.
The United Nations reports that half a billion people fall into poverty because of the effects of the Coronavirus.
A study published by the Ethiopian Economic Association says that if the virus lasts for a few months, many may become unemployed.
A recent study by the Ethiopian Employment Agency found that if the virus lasts for six months, 60 percent of people in manufacturing may lose their jobs. It also says that three million people could lose their jobs in the service sector alone, where more than nine million people are employed.
The export of agricultural products, entry of tourists from abroad, and direct investment has stopped due to the restrictions.
According to Kibure, this will have serious consequences in increasing unemployment and poverty.
To revive the economy, the government has to take selective steps in agriculture, industry, and service, he indicated. This is particularly true for the agricultural production for the domestic market as the effect would not be significant expect some fluctuations in price.
Accordingly, the government should play a leading role in reviving the economy, he added.
The Ethiopian Herald April 16/2020
BY TEWODROS KASSA
