Uganda’s Business Activity Has Reduced More Than 50% – NPA
By Adiga Julius
Covid-19 pandemic and the subsequent containment measures have affected and reduced Uganda’s business activity by more than 50% ,Rogers Mate the head of Micro planning at National planning authority (NPA) has revealed.
Presenting the impact of Covid-19 on Uganda’s economy, to the committee on national economy of parliament, Mate notes that sectoral analysis show that business in agriculture have experienced the largest decline in business activity with 76℅ of firms reporting severe decline and 12% reporting a moderate decline.
He said the index of business activity has fallen below 100% due to the risk presented by the containment measures of Covid-19 which indicates that businesses are performing below potential across board.
He said Uganda started feeling the impact of the pandemic even before the first Covid -19 case was reported in the country, Explaining that Industries like tourism and trading were among the first to suffer as a result of dwindling international circulation of passengers and goods.
He however notes that close to 26% of businesses in central region and 16% in Kampala have reported an initial increase in business activity, most of which are trade, and industry sub-sectors and the rest of the regions reported experiencing the largest declines.
On income and expenditure performance, Mr. Mate said many urban poor have lost their sources of regular income, creating financial inability as they have little or no savings to resort to, about 23% of the urban poor are at risk of losing 100% of their daily income .
He adds that direct and indirect government revenue has declined due to the loss of incomes including remittances and consumption due to Covid-19 mitigation measures.
The containment measure have resulted into reduced revenue collection, Uganda’s revenue bases is affected in terms, of consumption taxes ,direct taxes , trade taxes , non-tax revenues , there is likely to be a revenue shortfall of 82.4 billion shillings .
He said the national planning authority collected the information on Uganda’s economy from different sources, which include the central bank, Uganda micro finance research center.
On supply and demand for labour and remuneration, the pandemic measures have reduced work attendance significantly, about 73% of companies reported to have missed over 30% of their employee’s n due to lock-down.