{"id":8915,"date":"2020-06-02T17:56:37","date_gmt":"2020-06-02T17:56:37","guid":{"rendered":"https:\/\/www.africa-press.com\/kenya\/?p=8915"},"modified":"2020-06-02T17:56:37","modified_gmt":"2020-06-02T17:56:37","slug":"more-smes-on-the-brink-as-virus-takes-a-toll-on-economy","status":"publish","type":"post","link":"https:\/\/www.africa-press.net\/kenya\/economy\/more-smes-on-the-brink-as-virus-takes-a-toll-on-economy","title":{"rendered":"More SMEs on the brink as virus takes a toll on economy"},"content":{"rendered":"

AfricaPress-Kenya:<\/strong> Kevin Amunga stares blankly at his half stocked shelves in his phone and electronics shop in the busy streets of Moi Avenue in Nairobi\u2019s Central Business District (CBD)<\/p>\n

His shop is sandwiched between six others that remain closed, having been hit hard by the coronavirus pandemic that has ripped economies globally.During the pre-pandemic period, his shop would be a beehive of activity with more shoppers entering and leaving the plaza, where he has rented.<\/p>\n

But now, the traffic has been reduced to a trickle that gives him that is inadequate to pay the monthly rent. \u201cMy neighbours have closed shops, this has reduced traffic hence affecting my business. If the lockdown and dusk to dawn curfew continues, I will have no option but to fold up, because I won\u2019t afford to pay rent or sustain my business,\u201d said Amunga.<\/p>\n

His situation mirrors those of the many small and medium enterprises (SME) across the country that are on the verge of folding, occasioned by the pandemic. But the SMEs are not going down alone; thousands of Kenyans that are employed in this sector continue to face uncertainty as the lockdown is enforced.<\/p>\n

A 2016 report by the Kenya National Bureau of Statistics (KNBS) showed that there were about 1.56 million licensed micro, small and medium enterprises (MSMEs), and 5.85 million unlicensed ones, which employ about 14.9 million people.\u201cOn normal days, I used to employ at least four casuals who helped me in serving my customers, but now I can\u2019t afford to hire even one, as I serve fewer customers,\u201d said George Obiero, the proprietor of Delia Dishes at Jamia Mall in the CBD.<\/p>\n

To cushion the SMEs sector from possible collapse due to the effect of the coronavirus, President Uhuru Kenyatta last week announced that the Government will inject Sh3 billion as seed capital for the\u00a0SME\u00a0Credit Guarantee Scheme, in a 53.7 billion economic stimulus programme.<\/p>\n

Under the guarantee scheme, the Government will pay part of the loans taken by SMEs, thus enabling banks to extend more credit to small businesses at lower rates. But the scheme won\u2019t start anytime soon, with the earliest period when the cash will be availed to the SMEs being next month, a time when most business owners say they would have closed shop.<\/p>\n

\u201cI have exhausted all the possible ways to ensure my business remains afloat, I honestly can\u2019t go for another two more months if the government doesn\u2019t ease the restrictions,\u201d a dejected Amunga said. His sentiments have been echoed by the Central Bank of Kenya Governor Dr Patrick Njoroge, who opined that if the credit guarantee scheme won\u2019t start immediately, the country\u2019s SMEs sector would collapse.<\/p>\n

\u201cMSMEs don\u2019t have a lot of buffers, they generally would die quickly, they (MSMEs) are on the ropes,\u201d said CBK Governor Patrick Njoroge in a press conference last week.But micro-businesses which form the bulk of the informal sector in the country feel neglected by the government. They argue that the loans availed to the businesses wouldn\u2019t be accessible to them.<\/p>\n

According to the Kenya National Federation of Juakali Association Chairman Richard Muteti, majority of their members are semi-illiterate and hence do not understand the bureaucracy involved accessing the loans.\u201cThis is a good approach by the Government to help small businesses, but the informal sector the best way they can be approached for such an initiative is through their associations because individual members can\u2019t access loans,\u201d said Muteti.<\/p>\n

The country has over 17.5 million people employed in MSMEs according to the Kenya National Federation of Jua Kali Associations, which accounts for 83 per cent of the country\u2019s workforce in the private sector.<\/p>\n

Majority of these workers live from hand to mouth with little or no financial savings and the pandemic has not made things easy for them.\u201cMajority of our members have already closed shops, we have stopped talking about business survival, we are now talking about people survival, the pandemic has spelt death to us, and the president should ease the restrictions, our sector cannot hold any more,\u201d said Muteti.<\/p>\n

Amunga serves one of his customers before rejoining us for the interview; he hopes this will be the last weekend his business will have to survive the lockdown.<\/p>\n","protected":false},"excerpt":{"rendered":"

AfricaPress-Kenya: Kevin Amunga stares blankly at his half stocked shelves in his phone and electronics shop in the busy streets of Moi Avenue in Nairobi\u2019s Central Business District (CBD) His shop is sandwiched between six others that remain closed, having been hit hard by the coronavirus pandemic that has ripped economies globally.During the pre-pandemic period, […]<\/p>\n","protected":false},"author":84,"featured_media":8911,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2,2111,5,8],"tags":[3963,479,1617,3962],"class_list":["post-8915","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-all-news","category-coronavirus-in-kenya","category-economy","category-homepage-english","tag-economic-stimulus-programme","tag-jobs","tag-knbs","tag-smes"],"yoast_head":"\nMore SMEs on the brink as virus takes a toll on economy - kenya<\/title>\n<meta name=\"description\" content=\"Kevin Amunga stares blankly at his half stocked shelves in his phone and electronics shop in the busy streets of Moi Avenue in Nairobi\u2019s Central\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.africa-press.net\/kenya\/economy\/more-smes-on-the-brink-as-virus-takes-a-toll-on-economy\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"More SMEs on the brink as virus takes a toll on economy\" \/>\n<meta property=\"og:description\" content=\"Kevin Amunga stares blankly at his half stocked shelves in his phone and electronics shop in the busy streets of Moi Avenue in Nairobi\u2019s Central\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.africa-press.net\/kenya\/economy\/more-smes-on-the-brink-as-virus-takes-a-toll-on-economy\" \/>\n<meta property=\"og:site_name\" content=\"kenya\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/AfricaPressTunisiaa\" \/>\n<meta property=\"article:published_time\" content=\"2020-06-02T17:56:37+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/static.africa-press.net\/eritrea\/sites\/28\/2020\/06\/smes_position_to_5ed5c9e447a4d.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"800\" \/>\n\t<meta property=\"og:image:height\" content=\"533\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"cfeditoren\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"cfeditoren\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"4 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/www.africa-press.net\/kenya\/economy\/more-smes-on-the-brink-as-virus-takes-a-toll-on-economy#article\",\"isPartOf\":{\"@id\":\"https:\/\/www.africa-press.net\/kenya\/economy\/more-smes-on-the-brink-as-virus-takes-a-toll-on-economy\"},\"author\":{\"name\":\"cfeditoren\",\"@id\":\"https:\/\/www.africa-press.net\/kenya\/#\/schema\/person\/068c7ab4e9634ae78ec5d54ec46598bb\"},\"headline\":\"More SMEs on the brink as virus takes a toll on economy\",\"datePublished\":\"2020-06-02T17:56:37+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/www.africa-press.net\/kenya\/economy\/more-smes-on-the-brink-as-virus-takes-a-toll-on-economy\"},\"wordCount\":724,\"commentCount\":0,\"image\":{\"@id\":\"https:\/\/www.africa-press.net\/kenya\/economy\/more-smes-on-the-brink-as-virus-takes-a-toll-on-economy#primaryimage\"},\"thumbnailUrl\":\"https:\/\/static.africa-press.net\/eritrea\/sites\/28\/2020\/06\/smes_position_to_5ed5c9e447a4d.jpg\",\"keywords\":[\"Economic stimulus programme\",\"Jobs\",\"KNBS\",\"SMEs\"],\"articleSection\":[\"all news\",\"Coronavirus in kenya\",\"economy\",\"homepage-english\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\/\/www.africa-press.net\/kenya\/economy\/more-smes-on-the-brink-as-virus-takes-a-toll-on-economy#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.africa-press.net\/kenya\/economy\/more-smes-on-the-brink-as-virus-takes-a-toll-on-economy\",\"url\":\"https:\/\/www.africa-press.net\/kenya\/economy\/more-smes-on-the-brink-as-virus-takes-a-toll-on-economy\",\"name\":\"More SMEs on the brink as virus takes a toll on economy - 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