Lift lockdown to ease economic pain, leaders say

Traders and hawkers at Gikomba Market continue with their daily business with few buyers due to the government’s directives against Covid-19. [David Gichuru, Standard]

With the economy badly dented by the lockdown, leaders across the political divide are now rallying President Uhuru Kenyatta to engage experts in the formulation of a comprehensive economic recovery strategy.

Party leaders, governors and economic experts expressed concern that the struggling economy cannot sustain the lockdown any longer amidst huge public debt, shrinking revenues and job losses.

President Kenyatta on Saturday hinted at partially reopening the economy while announcing a Sh53.7 billion economic stimulus plan targeting eight sectors.

The president reckoned that countries across the globe “are all struggling to find a way forward” out of the Covid-19 crisis. 

“We will overcome this challenge as we have done in the past,” said the president.

Yesterday, Deputy President William Ruto said he backed the president on the reopening of the economy and the post-Covid-19 revival plan spelt out by Treasury.

Treasury Cabinet Secretary Ukur Yatani also agrees that it was time to consider reopening the economy, but was quick to point out that this must be done with appropriate protocols, caution and enforcement of real public discipline to avoid Covid-19 cases getting much worse.

“The president has already pronounced himself on this matter, especially the stimulus package, and our role in Treasury is to implement the same to the letter,” explained Yatani.

Yesterday, ODM leader Raila Odinga, his ANC counterpart Musalia Mudavadi, Governors Alfred Mutua (Machakos) and Ndiritu Muriithi (Laikipia) called for an all-inclusive approach that will address the challenges affecting the economy.

Mr Mudavadi, who at one time headed the Finance docket, said before a decision to open the economy is taken, President Kenyatta’s administration must conclusively put in place protocols that will safeguard against a possible explosion of the virus.

“Things to look at are what specific protocols will be put in place and how they will be enforced and observed. How will business centres and public transport observe social distancing as well as other containment measures to ensure health safety,” said Mudavadi.

“It would be important to indicate how well the county governments are equipped or being involved in this matter. Some counties are in weak financial positions now,” stressed the former vice president.

Mr Muriithi said there was no such thing as a right or wrong time to reopen the economy, arguing that it was all about strategy.

“It’s about how to adapt to the new reality. We need to be economically active in a way that does not spread the virus,” advised Muriithi, an economist who has in the past worked with the World Bank.

He reckons that counties and the National Government are grappling with how to live without spreading the disease.

“The opening of the economy depends a lot on the public’s discipline. It is about human interaction and therefore we must find ways and solutions to spur the economy without putting people at risk. The Swedish model has worked because stores are open and people maintain social distancing,” stated Muriithi.

Former Mandera senator Billow Kerrow said extension of the dawn-to-dusk curfew to prevent the spread of Covid-19 was unsustainable.

“It’s time to re-open the economy because we cannot sustain the partial lockdown any more. The country is not producing to its optimum, as workers are forced to leave their stations at 3pm to comply with the 7pm curfew,” he said.

“This essentially means people work between four and five hours a day. This is counter-productive for a struggling economy like Kenya. We should ease the lockdown.”

In response to the stimulus package unveiled by Uhuru on Saturday, the deputy president said the measures would mitigate the damage on the economy caused by the pandemic.

Yesterday, Ruto’s Communication Director Emmanuel Talam said his boss agreed with the president’s economic recovery plan to cushion Kenyans against the effects of Covid-19.

“The president has given direction on the two (reopening of the economy and the post-Covid-19 revival plan). That is his position,” Talam told The Standard.

Raila explained that to reopen or not was a government prerogative and would be informed by facts before it. He noted that it was only the government that can put in place containment measures that work.

“The government has so far pursued commendable approach in handling the disease and cushioning the economy under the present circumstances. We believe it will come to the right conclusion on when and how to reopen,” Raila said in a statement through his spokesman Dennis Onyango.

Mr Kerrow and businessman Suleiman Shahbal acknowledged measures taken by the State to cushion the Small and Medium Enterprises that have been hard hit by the virus.

The president had targeted sectors like education, manufacturing, transport, tourism and wildlife, agriculture, health and labour in the Sh53.7 billion stimulus plan he unveiled.

Similarly, Governor Mutua said it was import to find a solution to the economic slowdown by considering reopening the economy.

“We need leadership that transforms the economy and grows it properly to international standards to withstand any future shocks,” he said.

Mutua challenged Uhuru’s administration to invest more in manufacturing targeting every constituency.

“This will provide jobs in the counties and grow economies. For us to buy Kenyan products at an affordable rate, we need to impose higher duties on imported goods that can be produced locally,” he said.

Kerrow suggested that the stimulus plan unveiled was not enough to cushion the struggling economy.

“I don’t think the president’s eight-point intervention to cushion the economy is enough. The situation is very bad. The government needs to allocate between Sh300 billion to Sh500 billion to fix the economy,” he said.

“We have witnessed a lot of layoffs. The government must work on ways to create demand by increasing production and allow people to have money in their pockets by lowering taxes,” he proposed.

Muriithi also concurred on the issue of demand, saying we must stimulate demand by increasing both consumer and business credit to reinforce business confidence.

“We should support domestic tourism and above all, buy Kenyan goods.”

See related story in Financial Standard