This archive report was first published on 5 November 2019.
As of November 5, 2019, a liquidity crunch was severely affecting small and medium enterprises (SMEs) in Nairobi, with many struggling to stay afloat.
According to the latest financial sector stability report, half of Kenyans who take goods from shopkeepers on credit either delay in making payment or default altogether.
Agostine Gandi, the managing director of County Pride Ltd, a sanitation company serving NGOs, factories, and faith-based organizations, stated, "The last three months have been hard. Even the people we have worked for are not paying on time."
Truckers Association of Kenya Secretary General Kennedy Karisa noted that business was generally slow, and county governments had not made things easier by introducing double taxation.
"For instance, when transporting construction materials from Athi River to Murang'a, you are forced to pay cess in Machakos, pay again in Nairobi, and then pay at Kenol as you enter Murang'a," Karisa explained.
Real estate business, a major pillar for transport activities, had been hit hard, resulting in transporters having fewer contracts to deliver materials to construction sites.
Government data showed that the transportation and storage sectors recorded a slowdown in activities in the third quarter of this year, growing by 7.2 per cent, down from 8.4 per cent in the same period last year.
Players in the entertainment business had also not been spared, with some being forced to downsize while others had closed shop.
Titus Mugo, who runs movie shops in the CBD, stated, "We have had to close some shops in the CBD and diversifying into other things like selling phone accessories."
Austerity in government agencies as the National Treasury tried to bridge an ever-widening budget deficit had also starved many businesses of orders.
The net effect of this coupled with late payments was slowly killing businesses around the country, leaving millions of Kenyans devoid of a means to earn their daily bread.
