Covid-19: How Kenyatta’s shut down order will affect Kenya’s economy

Kenyan President Uhuru Kenyatta has announced the suspension of entry for all persons travelling into Kenya from any country with reported Coronavirus cases and the nation’s economy would be the worst hit with the ban.

Kenyatta announced this in his address to the nation on Sunday where he revealed measures the Kenyan government is taking to contain the spread of coronavirus in the East African country.

Kenya confirmed its first case of COVID-19 on Friday March 13th, 2020 and had traced 27 persons who had come into contact with the first patient.

As part of measures to contain the spread of the virus, Kenyatta said only Kenyan citizens and foreigners with valid resident permits will be allowed entry provided they take up self-quarantine or check into a government designated quarantine facility. The travel ban which will take effect within the next 48 hours to cater for any passengers who may be enroute will remain in effect for the next 30 days, the President said.

Kenya’s economy largely depends on the agricultural sector, with tea and coffee exports being the most important drivers. While the tourism, hospitality and the entire service sector is also a major contributor to the nation’s economy.

While the government must have reviewed the impact of its decision, reports by Kenya’s national daily Nation said the country’s tourism industry will be the biggest hit by the government’s decision to shut down its borders in an attempt to lock out the virus and slow down transmission.

Kenya’s Economic Survey 2019 revealed that tourism earnings increased by 31.3 per cent in 2018. The number of international arrivals increased by 14 per cent to two million people in 2018, while hotel bed occupancy increased by 20.1 per cent to 8.6 million, of which 52.1 per cent were occupied by residents, indicating the growing importance of domestic tourism.

But the lockdown announced by Kenyatta and various measures of government geared towards at stopping the transmission of the virus will have the consequences of reversing these gains.

Also projected to be badly hit is the nation’s aviation sector. The International Air Transport Association (IATA) estimates that airlines globally are set to lose up to $113 billion in passenger revenues if the virus spreads further.

Kenya Airways said on Monday that its Nairobi to China route is one of its highest grossing routes as it flies about 7,000 passengers from Nairobi to China every month, however, this is expected to experience a huge decline up to zero level with the travel ban announced by the Kenyan government on Sunday.

“The route is important for Kenya Airways flying about 7,000 passengers per month (Nairobi to China). As you are aware, China is arguably the largest trading partner with Africa and Kenya and, therefore, its significance cannot be downplayed. China is also a key cargo origin and a main feeder to regional freighters,” Kenya Airways told the Nation on Monday.

The airline estimates that it is losing at least Sh800 million (N2.8 billion) a month since the outbreak of the virus.

Meanwhile, some Kenyans have taken to social media to lament over the hike in the price of hand sanitizers in the country.

Hiking prices will not save you or the ones around you. Remember, the more people use sanitizers, the lower the risk of everyone getting it .Let’s all come together to bring attention to this disturbing issue.#COVID19KE
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— 𝙒𝘼𝘾𝙃𝙄𝙔𝙀 🇰🇪™ (@ItsWachiye) March 16, 2020

What can we say about people who bought all sanitizers and have started selling them at a higher price?#COVID19KE pic.twitter.com/Rvd6u10u3J

— Peter Munyi (@petamunyi) March 16, 2020

My key wish is that unscrupulous individuals do not start manufacturing ineffective and largely fake hand sanitizers….you will make a quick profit illegally, but Karma will find you and she’s never kind…#coronavirusinKenya #COVID19KE #Coronavirus

— Bernard Ndong (@BernardNdong) March 16, 2020