LAHORE: The Covid-19 and subsequent lockdown reduced the operations of 95pc businesses and caused disruption to supply chain and loss in the export orders of 92 and 23 per cent, respectively, according to an online survey conducted by the Small and Medium Enterprises Development Authority (Smeda) to assess the impact of the pandemic on the small and medium enterprises (SMEs).
The survey report released on Thursday highlights the issues being faced by the SMEs during the lockdown and its impact on employment and production. Increasing unemployment has become a major issue during the lockdown and 46pc of the surveyed businesses have laid off some of their employees. However, 26pc report that they will rehire their employees within a month after the end of the lockdown.
“Nonetheless, 89pc of the SMEs are facing financial issues while 60pc have reported issues in selling their product/service and have thus identified the areas for public sector support to sustain their businesses and mitigate the impact of Covid-19. These areas include; SME-specific support measures, including financial packages, tax relief, guarantees and grants, relaxation in payments of utility bills, support in paying salaries and easing conditions for loan repayments,” reads the report.
The survey was launched after Smeda noticed that business community, particularly the SMEs, started complaining of being badly affected by the partial lockdown because of the pandemic. The economy is witnessing a sluggish growth in services, manufacturing and agriculture sectors followed by an increase in unemployment, decrease in government revenue, decline in exports and disruption in supply chains.
During the survey period, April 3 to 14, the businesses participated from all across Pakistan. These 920 businesses have an estimated total annual sales turnover of PKR 29bn and employ an estimated 19,641 workers. Moreover, these businesses also employ an estimated 8,950 daily-wagers.
“Most of the businesses are small in size. 33% of respondents have an annual sales turnover of up to PKR 1 million and 34% employ 1 to 5 employees,” said a spokesman in a press release.
Published in Dawn, April 24th, 2020