Survey: Tea, coffee, horticultural sectors in Kenya likely to be the most affected by coronavirus outbreak

Kenyan farmers picking tea. [Photo courtesy]

Horticultural, tea, coffee and mining sectors are up against hard economic times occasioned by the coronavirus outbreak, a new survey by the Kenya Private Sector Alliance (KEPSA) indicates.

So dire is the situation, reports the Standard that 57 percent of manufactures have been forced to outsource inputs from other countries because of the ravaging coronavirus in China.

A further 13 percent have been forced to cut their production capacity adding to the 65 percent of the business reportedly running into losses due to coronavirus outbreak.

The survey conducted by KEPSA had 95 percent of respondents being locally-owned businesses from 17 different sectors of the economy. Thirty-two other business in the manufacturing sector were directly surveyed by the Kenya Association Of Manufactures.

The survey indicates that the losses averages below Sh1 million so far and they are grappling with reduced imports for consumer use and production use too.

Importation of industrial products, machinery, electronic equipment appliances and accessories have reduced as China accounts for over 21 percent of their imports.

Besides the manufacturing sector, tourism and hospitality sectors have been affected and could see the country’s hospitality industry witness a 40 percent decline in 2020.

Health, insurance, finance, construction and real estate sectors have been affected too as companies have to scale down their operations until a lasting solution is found to contain coronavirus.

Nonetheless, KEPSA adds that Kenya has an opportunity to stir up local value addition in its products and also source alternative markets besides China which is the lead export market for Kenya.

“A keen look at Kenya’s exports to China reveals that the major products including mineral ores, rawhides, and skins, vegetable-based textile fibres, tea among others are industrial inputs. With the outbreak of Covid-19, Kenya has an opportunity to drive up local value addition for most of these products and seek alternative markets for the finished products,” KEPSA cites.