One by one, the corporate world is lining up to join hands in the fight against COVID-19.
Since President Uhuru Kenyatta made a passionate appeal to companies to do what they can to assist stop the spread of the virus, companies are relooking at their books of accounts to see what they can do to support the initiative.
Already, hundreds of millions have been pledged directly or indirectly to fight the scourge. From the manufacturing sector to the finance sector, from the petroleum industry to agriculture, every corporate entity is doing its bit to join hands to fight the spread of the virus.
Pointedly, the main focus now is on containing and mitigating the virus itself. But the economic consequences are also glaring, and corporates are navigating their paths towards understanding, reacting to, and learning lessons from unfolding events. Unanticipated twists and turns will be revealed with each news cycle, this is why companies must also work to keep their supply lines open to continue serving the public to the best of their ability.
We understand the risks that the spread of the coronavirus means to businesses, to the society and to our existence as human beings. Since it was first dictated in December last year in Wuhan City in China, COVID-19 has infected over one million people and claimed nearly 60,000 lives across the world. Coronavirus does not seem to be slowing down and projections indicate that it may be months before it is put under control.
At Hass Petroleum Group, we appreciate the crucial role of our industry and fully support the government initiatives to fight the spread of the coronavirus. We have ensured our staff are safe and have flexi time to server our customers and supported the free-hand sanitizer to the public materially. We have also effectively leveraged our financial, logistics, distribution and bulk storage capabilities to ensure all the nine markets where we operate in Africa are sufficiently stocked and serviced with quality oil products to avoid further disruptions to normalcy.
Hass Petroleum Group has also refocused its corporate social responsibility programs and budgets to help the create awareness while pumping up the fight against COVID-19—and for a good measure.
In Kenya, the extent of devastation that the coronavirus can unleash on the economy is just beginning to take shape. At this point in time, no one really knows how it will pan out. A recent projection by global management consulting firm McKinsey indicates that Kenya might lose up to Sh1 trillion in output if the coronavirus’ spread is not contained.
The firm further indicated that the gross domestic product might fall to 1.9 percent from the current 5.2 per cent growth that the country has already witnessed. These figures are not good news and should serve as a driver for all in the corporate world to join hands and stop this plague.
Coronavirus came at a time when the economy was already stretched and must not be allowed to make the situation worse. All statistics we have so far point to an economy shrinking. The latest Stanbic Bank Purchasing Managers’ Index (PMI) survey indicates a drop in business activity to levels last witnessed thirteen years ago with a large drop in consumer demand and client orders. The headline PMI dropped to 37.5 in March 2020 down from 49.0 in February 2020.
This trend is expected to continue as stricter measures to contain coronavirus are rolled out by the various government agencies.
The biggest issue with the coronavirus menace is that a majority of firms downplayed the risks. COVID-19 caught everyone flat footed. Few companies envisaged, planned and budgeted in their yearly projections what is currently being witnessed. The emergence of COVID-19 means that the corporate world must go back to their drawing boards and relook at their growth projections and strategies and include the adverse effects of this disease.
In addition, companies must take into account the effect of the measures that the government is putting in place to fight the spread of the disease. As it stands, it is a requirement by law to release workers by 4pm to ensure that they comply with the 7pm to 5am curfew imposed recently to contain the virus.
This means less productivity on the part of the labor force. Firms will still have to budget for additional costs in trying to ensure employer safety. Implementing working from home programs will in many cases mean additional operation costs that were not envisaged at the time of planning for the year.
In such a scenario, there is only one thing to do. Refocus and re-budget all the CSR programs towards the fight of COVID-19.
(Mohamud Salat Mohamed is the Chief Executive Officer at Hass Petroleum Group.)
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