The news that Kenya’s economic growth has slowed down to 4.9 per cent in quarter one is unlikely to surprise anyone, alarming as that is. While official figures indicate that last year the country managed an impressive 5.8 per cent expansion in quarter one, the expansion rate for this year represents an eight-year low.
The major worry is what the numbers will look in the second quarter considering that the economy has been in a partial lockdown, which has in in turn hurt exports, hospitality and transport industries in a big way.
Alarmingly, this comes alongside closure of institutions of learning, whose impact implies that the newly officially unemployed numbers are just a tip of the iceberg.
Although the government has tried some fiscal interventions, it is clear that the preponderance of the private sector, and especially the informal sector, means that the economy has to be let to run its course if a catastrophe is to be averted.
That is what should weigh heavily on the mind of President Uhuru Kenyatta as he ponders on what measures to take to slow down the spread of Covid-19 without hurting the economy. The reality is that this virus, like many others, is not going away. Since many countries have rued reopening too soon, the government at all levels has to step up measures to curb the spread of the virus, an undertaking that is an uphill task considering that the public takes a casual attitude to the disease and authorities lack the capacity to compel compliance consistently.
We can’t shut down the long distance transport sector for ever. In the same vein, schools — State ones are paying teachers to stay at home — will not remain closed indefinitely. Neither will entertainment and hospitality establishments.
At some point, the economy has to reopen -- unless the government intends to cushion everyone from the economic shocks of the virus.
Tanzania, which does not look like a strong role model, has largely reopened and we need to follow suit, albeit in a more scientifically-backed method. The economy can’t afford to go to quarter three with the trends the country is experiencing now. It would, therefore, be prudent to carefully reopen the economy to prevent a socio-economic catastrophe.
PAYE Tax Calculator
Note: The results are not exact but very close to the actual.
