The Senate Ad Hoc Committee on Covid-19 situation is proposing that only tax compliant micro and small enterprises get access to liquidity support mulled by the government as Coronavirus Pandemic economic fallout deepens.
Speaking when he tabled the 4th and 5th progress report on Covid-19 situation in Kenya, the committee’s Chairman Johnson Sakaja further called on the industrialization trade and enterprise development ministry to publish regulations establishing the Micro and Small Enterprises Development Fund to allow its operationalization.
According to the Senate Ad Hoc Committee on Covid-19 Situation, MSMEs in trade, agriculture, tourism, retail remain the worst hit during the covid-19 pandemic.
Following the committee’s 51 sitting with various stakeholders across the country, the committee recommends for immediate operationalization of the MSED Fund and with expected release of liquidity support to small business, not businesses stand a chance to benefit.
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In April, in a State of the Nation Address, President Uhuru Kenyatta promised an SME credit guarantee scheme to exempt them from complex application procedures and collateral requirements against the impact of economic and financial disruptions caused by Covid-19 pandemic.
At the same time the committee recommended enhanced accountability and oversight over the covid 19 emergency fund, and other funds established in the national and county levels monthly–the senate all called on county assemblies to resume in order to provide their oversight role in monitoring emergency expenses.
Kenya’s GDP growth for 2020 is expected to decline to 3% and if extreme shocks persist, growth is set to go down further to 2.5% as global demand remains weak.
The committee is further calling on local sourcing of PPE and masks to support local industries.
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