COVID-19 biggest losers and winners in the lockdown

 

With businesses struggling to stay afloat in the COVID-19 lockdown, shrewd sectors are seizing the opportunities that the pandemic has to offer. Ali Twaha explores the possibilities  

 

Adjusting business operations to fit within measures put in place to stop the spread of the deadly COVID-19 pandemic has been a tall order for businesses. Equally difficult has been the drastic change for consumers to quickly adapt to the new normal. But amid the social and economic effects of the pandemic, some sectors are making more money under the new and restrictive measures. 

 

 

Medical supply, food processing, retail shops, information, and communication technology (ICT), as well as e-commerce, remain potential winners in the lockdown. At the Entebbe International Airport, authorities say most cargo planes touching down are carrying medical supplies to hospitals and companies, such as face masks and pharmaceuticals. 

 

Going forward, healthcare for business clients and employees will be paramount, as entities will have to prove that their operations are safe. 

 

Meanwhile, players in food processing and retail stores, such as supermarkets have experienced higher sales during the lockdown, especially for essential products like hand sanitisers and food. ICT is another sector that will emerge stronger. As companies maintain skeleton staff, many businesses are relying heavily on technology applications that enable real-time communication among staff. 

 

In particular, Zoom, a video conferencing firm is among the biggest winners in the lockdown. Reports indicate that the fi rm's market value jumped to about $42b as it emerged the preferred tech for online meetings for businesses. As such, telecom companies have registered increased demands for internet data and voice services in the last three weeks.

MTN's chief executive officer Wim Vanhelleputte reported that the firm registered between 30% and 40% surge in data traffic. 

Liquid Telecom's chief executive officer for East Africa Adil Youssefi said there has been increased demand for fast and reliable Internet as many people stay indoors. 

 

"We have doubled capacity with unlimited Internet for all our current home fiber users. As usage rises, our existing capacity will be able to take it, but we will keep a close eye on things and make changes if need be," Youssefi said. 

 

As people discover countless ways of communicating, experts predict that corporate entities and small businesses may be forced to adapt emerging technologies in certain aspects of their work. 

 

 

 

Online stores, such as Jumia and Bazebo, among others, are seeing strong demand as COVID-19 scared shoppers avoid brick and motor retail stores largely on account of the ban on public transport.  

 

Additionally, COVID-19 has seen Jumia and Reckitt, a global health product maker, pen a deal to provide access to hygiene products for customers at relatively lower prices. 

 

The E-commerce business could be a near time beneficiary of this temporary lockdown although keeping up with customer demands has been a daunting task.  

 

 

Dealers in food remain active in work as they provide one of the most essential services. The post-COVID-19 era will see a rise in demand for food according to experts. 

 

SMEs in this sector should look at harnessing the slowdown to fill gaps that will be created worldwide, according to Robert Mwesigwa, the president of Uganda National Chamber of Trade and Investment. 

 

"SMEs should, therefore, be inward-looking. For example, there will always be a demand for food, and our economy is agriculture-based. This is a big opportunity already," Mwesigwa said. 

 

 

The tourism, aviation, and hospitality sectors are some of the biggest losers in the lockdown. The pandemic has seen near-zero inflows of visitors, impacting the aviation, travel agents and hotels. For instance, Entebbe Airport employs over 10,000 people. 

 

However, about 9,500 are currently staring at a bleak future according to Wilson Usher Owere, the chairperson general at the National Organisation of Trade  Unions. 

 

According to Francis Kamulegeya, a Partner at PricewaterhouseCoopers, a consulting firm, COVID-19 calls for a deep review of business strategies across all economic sectors. 

 

"Review your business continuity plan if you have one. If you don't, this is the time to develop one. Check your business risk insurance policy. Does it cover these losses? If it does, talk to your insurance broker for assistance on making claims for loss compensation from the insurer. If you do not have a business risk insurance policy, this is the time to consider getting one," he said. 

 

"Do not lay off staff, instead consider flexible working arrangements at reduced pay. Have an open and honest discussion with your staff. They can also see what is happening to the business and they will understand," Kamulegeya added. 

 

 

 

This sector includes a range of activities to meet varied cultural, entertainment, and recreational interests of the general public, including live performances, operation of museum sites, gambling, sports, recreation, and bars. 

 

Experts predict that they are destined to fail unless they get credit to tide them over during these critical times. 

Players also predict that even when the lockdown is lifted, such sectors are unlikely to resume work given their "crowd pulling" nature. 

 

"Performances and concerts might resume in November or December. Even if the bars and concerts open tomorrow, people will not spend money on them due to other pressing obligations," Nimrod Nabeeta, an event organiser said during a TV show.  

 

 
FINANCIAL AND EDUCATION SERVICES  

 

Although industries were allowed to remain operational, at least 4,200 companies across the country have shut down. 

 

This is largely on account of the measures put in place that required facilitating their employees at their stations. 

 

Sector players argued that the move to layoff workers is as a means of survival. 

 

On financial services, a post-COVID-19 era will not leave banks the same. 

 

The Uganda Bankers Association chairperson, Mathias Katamba, acknowledged that the coronavirus pandemic is expected to undermine the banking sector. 

 

Education institutions being among the first to suffer lockdowns, the disruption will give educators time to rethink the sector. According to the World Economic Forum, the notion of an educator as the knowledge holder who imparts wisdom to their pupils is no longer fit for the purpose of a 21st-century education due to the new changes. 

 

With emerging ICTs, they argue that countries will need to redefine the role of the educator in the classroom and lecture theatre.