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Counting the cost of coronavirus

A man selling home made masks in Kampala last week

A man selling home made masks in Kampala last week

The outbreak of the coronavirus disease is posing a challenge to many businesses in Uganda, with experts predicting that the world will experience a recession.

Uganda on Sunday closed its borders with Kenya at Malaba, Busia and Rwanda after confirming its first positive coronavirus disease case, leaving commuters and truck drivers stranded.

Majority of traders between the two countries were caught unawares and to make it worse, Uganda is the easiest transit route to countries such as Rwanda, South Sudan and DR Congo.

With Uganda closing its borders, there is likely to be scarcity of food and other products in the region.

“We know it was coming but we didn’t expect the closure this soon. Right now, we are still stuck here in Kampala pondering what to do next,” Esther Nyang’ara, a trader from Kenya, said.

She added: “I am not sure what will happen next. Even the traders here are complaining that the sales have gone down and they are not paying us in time.” Peter Omambia, a truck driver, said they now spend more time at the border because they are undergoing stringent checks as the clearing agents are taking more precautions.

“Business activity is generally slow, clearing is slower. I used to do two Kampala trips a week but now if I do one trip, it will be down to luck,” he said.

President Museveni, while addressing the nation last week, urged Ugandans to stay home as a way of limiting the spread of the virus. Jaliat Nalwanga, a trader at Nalubega shopping arcade in downtown Kampala, said due to the fear for contracting coronavirus disease, few people are visiting her shop.

“As you know, China, where most of us buy things from, closed shop earlier; so, we have not been restocking. Secondly, buyers are few as most have decided to stay at home to avoid our crowded place, and also generally people’s disposable incomes have dropped,” she said.


Bank of Uganda is urging the public to embrace e-money and do online transactions, and avoid touching money which can be a source of the virus. MTN has scrapped charges on mobile money transactions below Shs 30,000 as well as introduced data packages that are conducive for people to work from home.

Wim Vanhelleputte, MTN’s chief executive officer, said they want people to avoid the handling of shilling notes that could aid the spread of coronavirus.

“You must have realized that today, any money sent via MTN [not more than 30,000] is sent freely,” he said last week. Airtel Uganda also followed suit. The company is offering their customers free transactions on its mobile money platform until April 19, 2020.

“Avoid cash. Send money through Airtel Money at no cost; No charges applicable to any Airtel-to-Airtel transaction value till 19th April 2020,” the Airtel Twitter handle posted last week.

All these free transactions have a financial implication on the company’s revenues. Reuben Robert, BetOn Uganda’s operations director, said that internationally, the adverse impact of the virus on the gaming industry is quite apparent. He said organized sporting events across the world, such as most of the European football leagues, have been cancelled as governments rush to enforce quarantine and isolation norms in the face of the pandemic.

“While the work-from-home concept has driven a surge in online betting, the cancellation of events to bet on has been an unforeseen blow to the operators,” he said.

Robert said; “Bettors have continued betting... we’ve faced less than three per cent decline because we are the only ones with a huge casino and virtual games section - unlike anybody else in the market today.”

According to Robert, margins on casino and virtual games are much lower than sports betting; so, the losses are there but he believes it’s just temporary as customers start getting used to playing on the non-sports betting options.

“We expect a lot of the customers who visit physical (land-based) casinos to now come to our online casinos. So, within the next two to three weeks, we’ll be back to our original revenues, if not higher,” he said. But for others such as Nalwanga, the future looks bleak.

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