Lockdown shuts 8 companies for good

EIGHT businesses have closed their doors, more than 25% of businesses temporarily closed, and 50% of those who operated, did so below their production capacity – all due to Covid-19 measures.

As a result, 63,7% of local businesses recorded revenue losses of more than 50% of their usual earnings, with manufacturing, hotels and restaurants, and construction suffering the most.

This is according to statistician general Alex Shimuafeni when he revealed the outcome of the Namibia Statistics Agency (NSA) Covid-19 impact assessment on formal businesses.

The agency surveyed the effects of Covid-19 on 546 businesses in Namibia as an experimental study aimed at providing an early indicator of the business impact resulting from stage 1 of the state of emergency.

Only 226 companies responded out of those reached across the 16 sectors of the economy.

The country was placed under lockdown from 27 March to 4 May.

This resulted in the temporary closure of most businesses not providing what is deemed essential services.

To aid policymakers on intervention, the NSA undertook a perception survey with a collection of data from 30 April to 11 May, assessing the impact of the five-week lockdown.

The survey revealed 96,5% of businesses that responded are adversely affected by Covid-19 and expects to be affected in the coming months.

The majority of operating businesses (68,8%) have indicated they have experienced a decline in local demand as the most commonly observed effect, with 65,1% of the companies projecting it may persist in the future.

Furthermore, “63,7% of businesses reported a revenue loss of over 50%, with the manufacturing sector (20,1%), hotels and restaurants (15,2%), and the construction sector (11,3%) bearing most of the brunt,” the assessment states.

The figures show most of the businesses (73) reported having lost turnover ranging between 91% and 100%, followed by 24 businesses losing between 81% and 90% of revenue.

The survey revealed that 50% of the businesses indicated they traded partially, while 25,2% were temporarily closed.

Out of those surveyed, eight businesses indicated they closed permanently after the lockdown period.

“And 3,5% of businesses cited they were permanently closed,” said the NSA.

On the other hand, reduced stock or raw materials was identified as only being a current effect and possible future effect by 14,2% and 9,6% of the responding businesses, respectively.

Despite the survey, the NSA admitted the actual impact of the pandemic on the economy remains unknown until critical variables can be identified, including the duration of the pandemic and the measures in place to fight it.

The agency also advised policymakers and politicians who are at the forefront of the response team that they must be equipped with the right information and analytics to guide policy, recovery strategies, and future planning – and therefore access to reliable data is critical.

The survey on the effect of Covid-19 on a selected business is a perception survey delivering near real-time information that provides an impression of the effect of Covid-19 on these businesses.