Uhuru to lift coronavirus restrictions in potential boost to stocks
President Uhuru Kenyatta over the weekend signalled he may soon lift some coronavirus restrictions to allow more businesses to resume operations and people to return to work. Kenya has been on lockdown for about two months as a measure to curb the spread of the coronavirus disease or Covid-19.
The lockdown measures have dealt a heavy blow to businesses and households. For businesses from hotels to retailers, sales have diminished as customers keep off to avoid contracting Covid-19. Moreover, the curfew has reduced operating hours, further crimping sales.
The hit to businesses has sparked a wave of layoffs, pay cuts and loss of income to families, further weighing on the economy. Stocks have borne the brunt of the difficult economic times as investors sell their shares to unlock cash to cope with the crisis. The NSE 20-Share Index, which tracks the performance of blue chip stocks, is down 24% for the year.
In a national address on Saturday, President Kenyatta said the country cannot remain on lockdown forever. He stressed on the importance of getting the economy up and running again while ensuring that people still observing the measures to stop the spread of the virus.
In addition to rolling back some restrictions, President Kenyatta also plans a massive economic stimulus program of Ksh54 billion. The reopening of the economy and the stimulus program should be a relief to businesses and the stock market.