COVID-19 hits small scale businesses hard

COVID-19 hits small scale businesses hard

Date: May 8, 2020
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By Jenipher Changwanda

Mzuzu, 8 May-   Informal traders in Malawi have been hit hard by the measures put forward to curb the spread of the Corona Virus.

Malawian President Peter Mutharika declared a state of disaster on March 20, 2020 in which saw a country wide closure of schools, closure of central and mobile markets, banning of public gatherings,  and urged the civil service and the private sector to encourage workers to largely work from home.

While the directive is  a good intervention to deal with the pandemic, in the eyes of others it is accelerating  feminization of poverty, as many women including those around Mzuzu University who are in small scale businesses have been hard hit. It is a directive that has negatively impacted on their life-line – their day-to-day business at the university campus.

Agness Jere, a small scale business woman at Luwinga Industrial Area closer to Mzuzu University says her business targets mostly students and that then closure of the college means she will have to struggle to make ends meet.

“The closure of school due to Covid-19 has really affected our businesses as we mostly depend on college students to buy our merchandise,” Jere says who is a fish monger.

Jere, a mother of three who uses the proceeds from her dried fish business to buy basic necessities for her family, reveals that she is now fetching K2,000 per day compared to the past when she was making more – almost K6,000 per day.

Alice Joseph, another small-scale business at Luwinga, laments that life is tough nowadays due to closure of schools as the supply is high than the demand.

She says her 3 years stay in the area, small scale business near university has been a source of income because the University offer education all year round with its Full-time and Open and Distance E-learning modes of delivery.

“Closure of schools due to Covid-19 has left us in poverty because we are failing to make enough profits to meet our daily needs. We have college students in this community all year round and things are not working because they have been sent home due to the pandemic”, says Joseph.

Similarly, in Mangochi , Violet Ibrahim, has lost her job at a certain restaurant which was operating near St John DMI University in the lakeshore town in southern Malawi because students who used to frequent the place have been sent home due to Covid-19.

She says the owners could not continue with the business because they depend on students to buy meals from the restaurant. Sadly, the presidential directive to close schools and colleges could take longer than anticipated. There are court battles against the directive and it is not known when the Supreme Court of Appeal will make a decision on the case in which the civil society wants government and the president not to order a planned lockdown.

“Our customers are students here. As you can see now business is at standstill because students have been sent home. A lot of people have lost their jobs because some are cleaners in their private hostels while others cook in restaurants. Others do some piece work like washing their clothes,” Ibrahim said.

A gender analyst from Mzuzu University, Burnet Musopole says such crises hit women harder than men due to cultural contexts that determine gender and even their access to resources. He says the impact is more devastating on women-headed households as the economic challenges during such outbreaks pose serious threat on women’s work and business activities – exposing them to increased risks of abuse and exploitation.

“Women are primary care givers in families. They fetch firewood, walk long distances to draw water for their families and even when they do business, they divert the proceeds to support their families due to societal roles imposed on one’s gender,” Musopole says.

He says although in Malawi the severe impact of the Coronavirus pandemic on the economy is yet to be seen, the closure of schools, borders and the ‘stay at home’ appeal to cut densification of the pandemic has already reduced sales for small scale businesses most of which are done by women and “the sad thing is that some are in business for survival while others have lost their jobs.”

He says: “The high turnout of small scale business women during the recent protests against the lockdown in some parts of Malawi is a true reflection that women are aware of devastating effects of the lockdown on their daily earnings.”

Sharing Musopole`s sentiments, the African Union (AU) latest analysis on Covid-19 and Women`s Rights notes that economic impact of the pandemic is hitting harder women in Africa as they constitute 74 percent of the population in the informal sector- working as street vendors and domestic workers.

The analysis further edges countries in Africa, during and after the time of pandemic, to include informal sector in policies  and measures aimed at mitigating the economic effects of the pandemic in order to accomplish  states obligations on women`s economic and social empowerment such as the Protocol to the Africa Charter on Human Rights in Africa (Maputo Protocol) which recognize women`s economic, social and cultural rights noting the denial of these rights often leave women vulnerable to further abuse.

The 2019 Report for Women in Informal Employment Globalizing and Organizing (WIEGO), 84 percent of the economy in Malawi is informal, with a growing involvement of women and children.

Currently, the Malawi Government through the Minister of Gender and Disability, in collaboration with Malawi Rural Development Fund (MARDEF) is organizing loans to boost women in small scale businesses as one way of mitigating the Covid-19 aftermath, a thing that has brought mixed reactions among gender activists in the country.

Executive Director for Coalition of the Empowerment of Women and Girls Beatrice Mateyu (CEWAG) says giving women loans is a good initiative as it will improve socio-economic wellbeing of women. However, the government needs to come up with good strategies to ensure that the scheme benefits the targeted group, she says.

“There is a need of proper identification of people to benefit from the scheme and ensure that it is not politicized nor end up in wrong hands. Community leaders need to be involved in identification of deserving beneficiaries,” Mateyu explains.

She adds that there is also a need of helping these women to balance up relationships with their intimate partners as this money might also put them on high risk of Gender-Based Violence (GBV).

“Chances of putting women on a risk of gender-based violence are high if you just give money to women without managing their relations with their intimate partners. There is a need of raising awareness on why these women have been targeted to benefit from the scheme,” Mateyu says.

Chairperson for NGO-Gender Coordination Network (NGOGCN) Barbara Banda, says it is naïve for government to use the loans as a response to women economic empowerment saying that defaults in the loan repayment are more likely to happen because the markets which these women use are currently closed.

“With schools closed, stay at home appeal and government working on essential service staff only, small scale businesses will not thrive and the results will be bad debts,” Banda says.

She says the problem is that government is being over-optimistic about functionality of small- scale business this time when there is a general decline in economic activity due to Covid-19.

“Currently the majority of suppliers of small-scale businesses products such as plastic shoes, groceries, maize four and second hand clothes are Chinese and Indians whose shops have since closed. Where will small business people go to buy commodities? This will result in shortage of goods or they will be forced to procure from non-traditional and more expensive suppliers,” Banda says.

She also bemoaned the use of mobile payments systems to purchase small items saying that it will be a challenge for a lot of women due to Communication and Information Technology (ICT) illiteracy levels.

“The use of mobile payment systems to purchase goods is not popular in Malawi when we compare to Zimbabwe or Kenya where you can even buy a cabbage using mobile money,” says Banda.

Jenipher Changwanda is a Malawian journalist. This article is part of the GL News Services Gender and Covid -19 news series.


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