Memuna Forna: Sierra Leone Telegraph: 14 July 2020:
Sierra Leone’s private sector is used to surviving crises, but COVID-19 will test many businesses to the limit. In every crisis, accurate, up-to-date information is one of the first lines of defence. Invest Salone’s COVID-19 information portal is helping to meet that need by providing free online access to reliable business-related information about the pandemic.
These are uncertain times. COVID-19 continues to take its toll in Sierra Leone, and while the number of cases and fatalities might appear relatively low across Africa, there are signs that they are rapidly increasing, according to the World Health Organization.
The full human cost of the pandemic has yet to be realised, and the world is also now painfully aware that proactive measures necessary to limit the spread of the virus (like travel restrictions, school closures and quarantines) are stifling economic activity, with severe consequences for the private sector.
The grim reality is that the world has been plunged into recession – the Organisation for Economic Co-operation and Development predicts that the global economy could plummet by as much as 7.6% this year[i]. And, according to the World Bank, the COVID-19 outbreak has triggered the first recession in the sub-Saharan Africa region in 25 years, with growth forecast between −2.1 and −5.1% in 2020 from 2.4% in 2019[ii].
How long or how severe this recession will be, no one can really tell. There is no clear end in sight to the pandemic, and as the experiences of Australia and Hong Kong show (countries that are in the midst of second and third waves of the pandemic), the virus can confuse even the best laid plans.
The world’s developed economies have responded with a series of unprecedented stimulus plans to cushion the blow to businesses and kick-start their economies. The Government of Sierra Leone’s immediate response to the fiscal, economic and health challenges has been the Quick Action Economic Response Programme (QAERP).
This includes a Le500bn stimulus package from the Bank of Sierra Leone, to support the production, procurement and distribution of essential goods and services.
Work on fine tuning the QAERP is still under way. Nevertheless, Sierra Leone’s economy will have little room to introduce stimulus packages that are in any way comparable to those of the major economies, even though recent research shows that Sierra Leone’s private sector (only recently recovered from the economic impact of Ebola) is already suffering.
An analysis of May–June data from the International Growth Centre’s data dashboard reveals just how deep the suffering goes. After the lockdowns in early May 2020, businesses reported that the number of hours per day business owners and employees worked remained lower than before COVID-19.
Eighty percent of those surveyed in the first week of June still experienced low customer demand. Furthermore, weekly profits of business owners remained around 50% lower than they were before the nation-wide lockdown and did not increase over time. A survey of business across several sectors conducted early in April 2020 by Invest Salone found comparable results.
Seventy percent of businesses expected sales to fall in the coming months with over 90% expecting the pandemic to adversely affect their business. Reduced local customer demand, reduced stock or raw materials, reduced international customer demand and staff shortages all figured prominently. Only 40% were aware of the government’s intervention packages, such as tax deferments, special loans and credit facilities.
The recent easing of restrictions can be expected to improve business conditions, although it is too early to tell by just how much, particularly when factors affecting crucial sectors of the economy – export and tourism for example – are largely beyond the government’s control.
The only certainty for Sierra Leone’s private sector is that business survival in the short term depends on adapting to a new economy, one influenced primarily by the pandemic. Many of the respondents to Invest Salone’s April survey recognised this, with 49% saying that they are looking at new opportunities, such as new sources of supply, local production and diversification.
For businesses to adapt and survive, staying abreast of the latest developments – national and international – is crucially important. An important initiative available to address the private sector’s need for reliable and relevant information is the Invest Salone COVID-19 portal which collates relevant news, research, toolkits, training courses and practical guidance for businesses.
The portal, which has been launched with new features and content, can be accessed at https://investsalone.com/covid-19/, and to get a better understanding of the private sector’s needs and interests, the Invest Salone team is asking business owners to send in their feedback and suggestions for the site by emailing enquiries@investsalone.com.
The Invest Salone COVID-19 information portal is a free online resource supporting businesses and investors in Sierra Leone through the pandemic by providing up-to-date, reliable information. The portal can be accessed here: https://investsalone.com/covid-19/.
Invest Salone is a private sector development programme, supported by UK aid, that aims to facilitate investment in the agriculture, fisheries, manufacturing and tourism sectors to help raise the income of 370,000 people in Sierra Leone.
The opinions expressed in this feature are those of the author and do not necessarily represent the views of the programme, UK aid and the programme partners.
[i] http://www.oecd.org/economic-outlook/june-2020/
[ii] https://www.worldbank.org/en/news/press-release/2020/04/09/covid-19-coronavirus-drives-sub-saharan-africa-toward-first-recession-in-25-years
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