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Safety Nets Needed to Ease Economic Pain

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Nyakundi Report

Newsroom 2 min read

This archive report was first published on 17 May 2020.

As Kenya enters its third month of lockdown, the economic toll of President Uhuru Kenyatta's drastic measures to contain Covid-19 is becoming increasingly apparent.

Despite initial expectations that the President would relax regulations, he instead extended the dusk-to-dawn curfew and lockdown of movements in and out of Nairobi and three coastal counties for another 21 days, and closed Kenya's borders with Tanzania and Somalia.

While the President's concerns about the potential for a spike in new infection cases are legitimate, the country's health system is generally defective, and increased infections would outstretch the health system with catastrophic consequences.

Advanced countries such as the US, France, Spain, and Italy have demonstrated that the pandemic can wreak havoc even on big economies, making the impact worse for developing economies like Kenya.

As the President announced the containment actions, he ought to provide safety nets to cushion citizens from the negative impacts, including massive layoffs, stalled businesses, and lost contracts.

While some welfare packages, such as tax waivers and cash transfers to the vulnerable, may have helped alleviate distress, they have only provided a little relief.

There is agony all round, and it is not lost that after the President announced tax waivers last month, National Treasury later made fresh proposals to introduce new levies that would eat into workers' incomes, rolling back gains on the tax relief.

Now, President Kenyatta should enhance reliefs to cushion citizens and spell out the roadmap towards post-covid-19 recovery.

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