Businesses optimistic as economy recovers
Local investors are looking forward to better times ahead with various indicators pointing to a more vibrant business environment going forward as most sectors gear towards normal operations amid Covid-19 pandemic.
Already, the July Purchasing Managers Index (PMI) projects that the business environment will be positive over the next one year, boosting expectations as key sectors push for normal operations.
“Business confidence improved to a five-month high in July, with nearly a third of businesses providing a positive forecast for output over the coming 12 months.
Several firms cited plans to open new branches and increase their advertising,” reads the PMI report in part.
During the month agriculture, construction and services registering growth in new businesses while manufacturing, wholesale and retail posted a dip as the new tax regime started to bite.
Overall, the index in July fell to 50.6 from 51 in June meaning that the business operating conditions improved but at a lower rate compared to both June and May.
This as public service vehicles resumed carrying passengers at full capacity after the government reviewed a March 2020 directive that required them to operate at half capacity in the wake of the Covid-19 pandemic.
The decision will enable the matatu industry recoup a part of the Sh31 billion it has lost since March 2020.
With the resumption full capacity operations, Matatu owners now say they are considering revising some bus fares downwards, a move that will serve to reinvigorate the economy.
“Every one of us has been hurt by the ongoing pandemic. However, through consultations we will look into areas where we will have friendly fares,” Matatu Owners Association Chair Simon Kimutai said.
Last week, Tourism Cabinet Secretary, Najib Balala said hotels and restaurants can now operate up to 9 o’clock in the evening, an improvement from seven o’clock earlier.
To further shore up their revenues, Balala said hotels can still host meetings of up to 30 people despite a recent directive by the government banning all public gatherings.
“We allow meetings of smaller numbers and a regulated form of compliance with the protocols. So, those small meetings should be taking place, a maximum of 30,” he said.
To accelerate recovery of the hospitality industry which was hit severely by the Covid-19 pandemic, the government will prioritise vaccination of hospitality workers against the virus with Balala saying 50,000 doses will be set aside for them, a move lauded by the sector players.
“We are seeing the industry begin to recover slowly. For us it is about how can we then deliver our services in a safe manner,” said Hotel Keepers and Caterers Association chairman, Mike Macharia.
Despite the positive sentiments, Kenya still faces the challenge of dealing with the Covid-19 pandemic especially with the highly virulent Delta strain taking a toll on Kenyans.
So far, Kenya has vaccinated only 2.6 per cent of the population, about 1.8 million people according to Ministry of Health figures.
Worse still, 2022 will be an election year raising fears that political activities could interfere with economic activities.
ODM Party leader Raila Odinga on Sunday called on the government to come up with a package to spur economic development and cushion the poor.
“We want the government to come up with a package that will help to eliminate the suffering of our people,” he said