Voice of Khyber Pakhtunkhwa
Sunday, June 16, 2024

Effects of Corona virus on Businesses in KP

Amidst this ominous shadow cast by Covid-19, something new and fascinating has happened around the world when it comes to improvement in environmental pollution .

However Covid-19 lockdown has greatly reduced economic activities not only around the world but in Pakistan too specially in Khyber Pukhtunkhwa.

Recently KPK reported hundreds of new cases of coronavirus during ongoing second wave.

Earlier the lockdown in February forced closure of many businesses which has affected the economy of the province to a great extent, especially tourism and hoteling business was hit hard.

Back in 2018, KP was one of the fastest growing economies among the provinces in Pakistan. Despite battling terrorism, KP was able to come out of low security province and excel in economy.

Today, it contributes approximately 13% of GDP to Pakistan’s economy largely thriving on agriculture besides seasonal tourism gave an additional boost to the provincial economy.

All this seems to have changed after the onset of the COVID-19 pandemic and associated lockdowns which has resulted in rendering thousands of people unemployed specially the daily wagers but also affecting GDP growth. The businesses destined to suffer the most are micro, small and medium-sized enterprises (MSMEs). MSMEs are highly dependent on routine businesses cash influx as well as their small number of loyal customers. The famed bazaars and small shops of KPK fall under the category of MSMEs hence these businesses are finding it hard to survive during this era of the pandemic. These MSMEs are providing employment and income to a significant number of people in KPK. According to SBP (State Bank of Pakistan) MSMEs contribute about 40% to the national GDP. As per a recent report of UNCTAD (United Nations Conference on Trade and Development), Pakistan is estimated to be one of the most hardest-hit countries by this pandemic.

In addition, a project study by the World Bank ‘Economic Revitalization of Khyber Pakhtunkhwa and erstwhile FATA’ showed that the four most visited sites of KPK recorded a significant amount of tourism—approx. 5 million. These sits in KPK support 8,665 direct jobs, contributing about 5 million USD to the local economy. These tourist spots and public places have been closed since March. Many restaurants which tourists visited had to be closed or downsize their operations to focus on only home deliveries with the majority of employees end up being laid off.

Another unfortunate issue is that some small businesses that want to stay up and running or have the potential to remain open are simply unable to because the owners do not know how to utilise technology. Many are unable to use a phone to start social media accounts for their restaurants to promote home deliveries. Owners of small shops sometimes also find it challenging creating social media business pages where their goods can be sold. In addition, even the Government of Pakistan is technologically inept when it comes to integrating technology with tourism. There is a potential to give virtual tours of various tourist sites for a small fee. Even special shows could be performed on those aforementioned sites and people could be invited via ZOOM to watch those shows.  It would not be as enriching or stimulating as real life but it could prove to be a new experience for many people.

However, none of the above is taking place on a scale it should be which is causing many businesses within KPK to suffer. The tourist spots once filled with the laughter and smiles of warmth are now cold and empty. The economy of the province which was growing at a promising rate is now in decline. Therefore, despite the environment thriving under the corona pandemic, businesses are among those bearing the brunt of the undesirable impacts.


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