GBARNGA, Bong- County — Petty traders in Bong County are seeking the intervention of government through the provision of loans to help mitigate the impact of COVID-19 on their businesses.
Report By: Moses Bailey, LMD Responsible Health Reporting Fellow
The petty traders say restrictions intended to curb the spread of COVID-19 in the country greatly paralyzed the smooth operations of their businesses.
Most of them say they are unable to pay back loans that they took from banks and other financial institutions.
Musu Yancy, a local shop owner in Gbarnga, told LocalVoicesLiberia that most of her goods got expired in the shop because she could not get the normal influx of customers during the lockdown.
“I bought goods and they were here in the shop and the virus outbreak happened. Business was not moving like before; the buying rate dropped and there were no customers. Most of the goods got expired and I had to get rid of it,” said Yancy, who sells food and nonfood items.
Yancy is worried that she is unable to settle her debt with a local savings club. Most of the money she borrowed was used to purchase goods, and the rest was spent on food for her family during the lockdown.
During the beginning of the outbreak, the government instituted several restrictions on the movement of people and a curfew in most parts of Liberia, to help stop the further spread of the virus.
Like many others, Yancy needs financial intervention to help her business to regain its pre-COVID-19 status.
“If the government or the county officials can even help to provide us loan as small businesspeople, it will really be good. It will help us to get money to feed our children and pay their school fees,” Yancy said.
Amid the difficulties, Yancy says she will try to keep her business afloat. But another factor that continues to be a challenge for her is the unstable exchange rates between Liberian and United States dollars. The market exchange rate is now L$200 to US$1 while the Central Bank of Liberia’s exchange rate is L$198.9 to US$1.
However, the instability of the exchange rate often causes uncertainties for traders like Yancy. Most times, she exchanges at a rate of L$200 for US$1 but when she goes to the wholesale shops or stores, she is made to purchase goods at the rate of L$210.
The challenges Yancy faces are similar to what Matthew Kollie is enduring with his own business. Kollie’s business was moving smoothly before COVID-19. He was making profits regularly and could take care of his family.
Now, Kollie says there is a sharp decline in his income from the business because of COVID-19. He is spending more on his family and the business is not producing the profits to cover his expenses.
“Today, there is no replacement in what we eat from the business. We need the support of the government – either loan with less interest rate, or the government must pre-finance our businesses,” Kollie said.
Even though there has been a decline in the number of confirmed cases in recent weeks, the impact of the pandemic on small businesses is still very much glaring. Currently, Bong County does not have an active case of COVID-19. The county had earlier recorded 34 cases of the disease and five deaths between June 3 to July 25 this year.
It seems likely that the economic consequences of the lockdown across Africa are going to be even harsher then they will be in Europe or the United States, according to an article published in the International Growth Center (IGC) on April 3, 2020.
It is not clear whether the local authorities in Bong County are considering providing any sort of stimulus package for local business to help them rebuild or strengthen.
The county recently received US$527,000 from national government as County Social Development Fund. Businesspeople in the county are hopeful that their interest will be considered in the allocation of the funding.
However, the chairperson of the Bong County Legislative Caucus, Representative Joseph Kolleh said the county has a lot of competing development priorities that are being considered by the leadership.
The Liberian government only announced a “stimulus package” for the worst affected COVID-19 communities in the country. There are no clear plans to provide financial support to small business owners who are being negatively impacted by the COVID-19 pandemic.