EAC partner states count cost of virus

Saturday May 02 2020

As the Covid-19 pandemic ravages almost all sectors of the EAC economies, job cuts have worsened the unemployment situation. FILE PHOTO | NMG


Tourism, logistics, and retail sectors are the hardest hit by the Covid-19 pandemic, suffering a fall in cashflow of 92 per cent, 75 per cent and 63 per cent, respectively, across the region.

A survey by the East African Business Council lists real estate, finance, construction, Events management, ICT, manufacturing and consultancy as the other sectors to have suffered.

However, the pharmaceutical sector has stayed unscathed, says the report, titled Impact of Covid-19 on EAC Trade and released on April 27.

The report says although movement of cargo is not restricted, some partner states have limited the movement to essential goods only. This has the potential of reducing the value of intra-EAC trade.

The report offers a recovery strategy, recommending partner states to consider a regional co-ordinated approach on mitigating the impact of Covid-19; to consider allowing free movement of both, essential and non-essential goods within and out of EAC; to consider full liberalisation of open skies for free movement of cargo within and out of EAC.

They should also consider adding health workers at the borders to facilitate movement of cargo effectively and efficiently; to source for alternative markets for EAC imports and exports to reduce dependency on a few countries; embrace use of technology in sourcing products from outside the EAC.


For the medium and long term, the EABC recommends that: Partner states consider improving the business and regulatory environment to ensure formalisation of businesses in the partner states; there is need for states to push for “Buy East Africa Build East Africa” to provide support to key industries.

This will cushion the EAC from the negative impact of Covid-19, and finally that states facilitate the private sector to increase production of manufactured goods in the EAC to reduce importation.

The Covid-19 pandemic has created an increase in demand for pharmaceutical products and egged on partner states into allowing movement of essential goods such as pharmaceuticals across borders.

“Kenya, before the Covid-19 outbreak, exported fresh produce valued at approximately Ksh144 billion ($1.44 billion) per year and Ksh127 billion ($1.27 billion) per month,” said Peter Mathuki, the chief executive of the EABC.

Ugandan exports declined from $383.62 million in January to $352.91 million in February.

In Rwanda, due to Covid-19 effects, there has been a decline of 150 tonnes per week in horticulture products that were ferried by RwandAir.