Figures from the latest Private Sector Development Survey (PSDS) 2019/20 indicated that almost half of the businesses in which turnover was slumped experienced a decline of at least 81%. Some 90% of the survey respondents said they suffered a loss of turnover while 30% of businesses experienced a decline between 91% and 100%, while another 12% saw a turnover decline of between 81% to 90%.
The Namibia Statistics Agency (NSA) conducted a survey of 546 formal businesses in the country, of which only 226 businesses responded to the survey. While there is no doubt that businesses were hit hard by the lockdown, half of the businesses continued to operate partly and about one quarter closed temporarily. Only 21% continued to operate at full capacity while almost 4% had to close permanently.
According to the PSDS, the manufacturing sector had the highest share of businesses still operating at full capacity, most likely because they fall into the category of essential services. This was followed by the education sector, administrative and support services, and professional services.
“At the other end, the hotels and restaurants sector reported the highest share of temporary closures ahead of the real estate sector. About 90% of the responding businesses indicated that they expect a further adverse impact on their operations,” reads the NSA report.
Alex Shimuafeni, CEO of the Namibia Statistics Agency, said their agency is embarking upon Round 2 of a survey of Business: “The purpose of the survey is to measure the prevalence and nature of adverse effects from Covid-19 experienced by selected businesses operating in Namibia during stage 2 and stage 3 (May 2020 – June 2020).”
This second round survey on the perception of businesses started on 28 July and will run until Friday, 7 August 2020, and it is done to indicate the effect of the novel coronavirus on selected sectors of the economy. The survey will only cover the formal businesses selected from the database of the NSA.
The PSDS survey also revealed that about two-thirds of the businesses faced a drop in local customer demand, while almost a third experienced declining demand by international customers. Only about 14% saw a drop in stock or raw material and even fewer (10%) expect this to continue in the future. Staff shortages were of concern to only a minority of businesses.
“The 2019/20 PSDS comes at a time when the global economy is in turmoil, owing mainly to the outbreak of the Covid-19 pandemic, but also due to increased protectionism and nationalism that has created uncertainties for investors. Namibia just emerged from a prolonged period of droughts and an economic recession caused, among others, by necessary fiscal consolidation to rein in the budget deficit and total public debt. The ban on most inbound international flights, school and university closures and the declared state of emergency will hit the economy hard,” explained the report. - email@example.com