New covid restrictions threaten jobs, incomes

Employers Consultative Association of Malawi (Ecam) says latest global travel restrictions have potential to threaten jobs and incomes of Malawians.

Ecam’s sentiments follow the move by over 15 countries across the world to impose travel bans following a new Covid-19 variant detected in South Africa.

In a written response on Tuesday, Ecam executive director George Khaki said the restrictions pose threats to businesses, especially disruption of supply chains, which would affect both imports and production on one hand and exports and generation of foreign currency on the other. 

He said: “Ultimately jobs will be affected, especially in some industries, including travel and accommodation, manufacturing,  transport,  retail and wholesale.

“So in short, the current situation brings uncertainty which is not good for business and investment. Recovery will certainly slow down.”

The Malawi job market has been hit hard by the impact of the Covid-19 where 273 712 Malawians became jobless in the first half of 2020, according to a survey conducted by Ecam.

The 2021 Annual Economic Report indicated that by mid-2020, Malawi lost over K42 billion in revenue through cancellation of confirmed bookings and an estimated 300 000 jobs out of which 253 000 were direct jobs due to the Covid-19 pandemic.

Ecam had estimated that by March this year, 680 496 jobs would be lost due to the pandemic.

“In order to handle this, we need large population of the country to get vaccinated. This is the only insurance we have,” Khaki said.

Meanwhile, United Nations Development Programme figures show that as at June 2020, incomes of 77 percent of Malawians were affected due to the Covid-19 pandemic.

Among those who suffered losses, the overall median income decrease was K100 000 with urbanites experiencing higher losses than rural folks at K140 000 and K100 000, respectively.

However, majority of people (61 percent ) further expected income changes between now and the end of the year, with most of them expecting losses of between K150 000 and K250 000 or 57 percent.

In terms of economic sectors, wholesale sector experienced the highest loss in output (K29.8 billion), followed by manufacturing (K28.9 billion)and food and accommodation (K11.86 billion).

In an interview on Tuesday, Consumers Association of Malawi executive director John Kapito observed that the current economic and social challenges consumers are facing will deepen due to the fourth wave.

He said: “This is the time we need the leadership to prioritise sectors that are key for the welfare of consumers and growth of the private sector.

“Unnecessary expenditure must be curbed and our leaders must stop making unachievable promises.”

Malawi Confederation of Chambers of Commerce and Industry chief executive officer Chancellor Kaferapanjira is on record as having said that local businesses are not spared the coronavirus threat with hospitality, retail businesses and the travel industry among the worst affected sectors.

Ministry of Trade spokesperson  Mayeso Msokera admitted that the coronavirus outbreak is likely to affect volumes of trade to Malawi due to disruptions in global supply chains.

Figures show at the peak of the pandemic last year, the local tourism industry lost about 30 000 jobs.