For a long time, Kenya’s economic fortunes have been tied to the performance of the agriculture sector but this needs to be re-looked in view of the global coronavirus pandemic.
The pandemic, which has affected 396 and killed 17 in Kenya, has hit nearly all segments of the country’s economy, severely denting the role of agriculture in shaping Kenya’s economic fortunes.
This has also set the stage for loss of jobs and earnings in the sector, the biggest employer in the country.
The shifts in the economy have highlighted the critical role of supply chains and the need to manage the cost of credit to sector and how these are important in protecting the economy from further deterioration.
This is the time businesses require emergency funds to keep them afloat and avoid further job cuts and supply disruptions. Workers, including those in agriculture, agro-processing and related services are either being laid off or being placed on unpaid leave.
They could require affordable and sustainable credit in the short term to meet their daily obligations and create demand for goods and services. The subdued consumer demand for goods and services has slackened the capacity of many Kenyan firms to boost production that will offer some room for fresh hiring and stop executives considering shedding jobs to preserve cash and profits.
It is commendable that banks have already cut the cost of credit to the lowest level in 15 years following the drop in the benchmark rate and a reduction in demand for new loans. This is a step in the right direction. However, what many Kenyans need now is adequate supply of affordable credit to spur consumer spending as the country battles to flatten the coronavirus curve.
It is also important to cushion agriculture in all ways possible to ensure a steady supply of food and related commodities during and after the global pandemic.
Similarly, consumers ought to be sensitised on the need for balanced diets to ensure they boost their immunity and put them in better footing to recover in the event of infection.
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