Lockdown, fuel price hike fears loom large

Closed shops in downtown Kampala after President Museveni announced a lockdown due to Covid-19 in March 2020. PHOTO / FILE  

What you need to know:

  • With Ugandans struggling to keep the lights on, there is a sense that trouble is brewing as the perfect storm of a lockdown and fuel price hikes threaten to make the forthcoming festive season grimly negative and entirely joyless.

As Ugandans ready themselves for the penultimate month of 2022, trouble appears to be brewing on the horizon. With inflationary pressures still buffeting the economy, the prospect of Kampala and surrounding areas going into lockdown—as part of Ebola Virus Disease (EVD) curbs—has the potential of making the festive period grimly negative and entirely joyless.
Since the declaration of an EVD outbreak last month, the government hasn’t shied away from using the well-calibrated mix of pressure and reward that—to a certain degree—served it well during the coronavirus pandemic.
By Wednesday, the number of confirmed Ebola cases had risen to 109, with 30 people confirmed dead, according to the Health ministry.

On October 15, President Museveni sent the ground zero of the latest outbreak—Mubende District—along with neighbouring Kassanda, into a 21-day lockdown. Two days later, after two positive cases in Kampala were traced back to Mubende, Mr Museveni “directed a full mobilisation of Kampala City into a response mode.”
Health minister—Dr Jane Ruth Aceng—on Wednesday confirmed that as many as 170 contacts are being traced. There are reports that the number of contacts could be as high as 300.
This followed a “rapid spread of infection” from a case in Kassanda that, among others, infected half a dozen pupils who “attended three schools in Rubaga Division.”

Crown jewel
Such is the spread of infection that many observers are resigned to the possibility of Greater Kampala Metropolitan Area (GKMA) going into lockdown.
The GKMA, according to the National Planning Authority (NPA), comprises Kampala Capital City Authority (KCCA), Mpigi, Wakiso, and Mukono districts, and Nansana, Kira, Makindye Ssabagabo and Entebbe Municipal local governments.
It contributes 31.2 percent of Uganda’s Gross Domestic Product (GDP), hosts 46 percent of all formal employment in the country, and represents 10 percent of the country’s population, the NPA adds. Some other statistics show that the area is a major business and industrial hub, contributing over 70 percent of Uganda’s industrial production.
Needless to say, sending the GKMA into lockdown will have spillover effects beyond its bounds. Yet on Monday, Dr Samuel Oledo—the Uganda Medical Association (UMA) president—made it abundantly clear that a surge in cases means there is little wisdom in viewing EVD’s presence in the area as low-risk.
“Kampala should have restriction of movement. Let us hold Kampala when it is still early. The earlier we lock down Kampala, the better,” Dr Oledo told KFM’s The Hot Seat show on Monday.

Trust issues
The pushback to such narratives has been visceral, with Joseph Kabuleta—a former presidential candidate—without providing evidence, warning of a ploy to trial vaccines that “are even more deadly than the Covid-19 ones.”
Also, it has barely helped matters that the pandemic and its attendant restrictions served as a catalyst for corruption. Law enforcement, for instance, engaged in large-scale extortion and brutality. With similar reports coming out of Mubende and Kassanda, the Health ministry and other state organs face the onerous task to rebuild trust with the population.
Many Ugandans are also worried about financial forfeits that will come with EVD curbs like a lockdown.  
Tadieus Musoke Nagenda, the chairperson of Kampala Capital Traders Association (Kacita), told this newspaper on Wednesday that instituting a lockdown “will be very unfortunate” not least because “we are still suffering from the effects of the lockdown of Covid-19.”

Tourism losses
The aforesaid lockdown knocked the hotel industry sideways, with hotel occupancy rates plunging to under 40 percent before the 2021 festive season as per the Uganda Hotel Owners Association.
The tourism industry, which usually cashes in on the festive period, also has good reason to fret. Empirical evidence from Uganda Civil Aviation Authority (UCAA) indicated a telling dip in international passengers during the month in which the outbreak of EVD was confirmed. The country’s only international airport in Entebbe facilitated 144,089 international passengers (including 63,997 arrivals) in September. This translated into an average of 4,802 passengers per day—a significant drop from August’s average of 5,034. 

Since the government announced the EVD outbreak at the backend of September, experts say the October dataset will provide a better snapshot. Even then, UCAA says “the figures usually peak again with heightened tourists movements during the winter, especially from November to February.”
There are, nevertheless, fears that the latest EVD outbreak will throw a spanner in the works. If this happens to be the case, it will hardly be a novel development. When EVD proved thunderously hostile in Sierra Leone, one study revealed that tourist arrivals nosedived by 50 percent between 2013 and 2014. 

Amos Wekesa, a Uganda tour operator, who in 2015 joined the “Africa is not Ebola” campaign, warned of a bumpy road when Uganda’s latest EVD outbreak was announced in a manner that—he reckoned—was abrasive to tourism given its potential.
“…if we had three million tourists coming through our airport, Uganda would earn $150m (Shs568b) in visas alone and another $171m (Shs648b) in airport fees alone,” he tweeted back in September, adding, hypothetically, “If each of the tourists spent $250 (Shs947,000) per day for eight days on food, car hire, fuel, accommodation, shopping, etc, it would translate into three million tourists x (250 x 8) and that would be $6m (Shs23b.”

Urging calm
Information minister Dr Chris Baryomunsi said while the surge in EVD cases made it to the agenda of Monday’s Cabinet meeting, the prospect of a lockdown was never put on the table. Dr Henry Mwebesa, the director general of Health Services, also said the National Ebola Taskforce will only contemplate curbs such as a lockdown “if the situation changes significantly.”
If Mr Museveni prioritises protection by sending Uganda’s beating heart— the GKMA—into lockdown, this could be one of many things that herald the start of a dark 2022 festive period for Ugandans. 

Fuel price hikes?
The Organisation of Petroleum Exporting Countries (Opec) and non-Opec countries will next month whittle down the crude oil it puts out on the market by two million barrels per day.
This is widely expected to force the graph of petrol and diesel prices back on an upward curve after dropping below Shs6,000 at the back end of this month. To worsen matters, a 15 percent increment in transit tolls at the Suez Canal is further expected to push pump prices upwards. The new tolls for vessels using the Suez Canal waterway will come in during January of 2023, with a new school term looming. Fuel that ends up in Uganda is shipped through the Suez Canal.

Motorists in Uganda have faced strong headwinds from fuel inflation for the vast bulk of 2022. Soaring prices of petrol and diesel triggered climbs in annual transport inflation and motorcycle fares inflation, leaving many in the grip of an acute inflationary spiral. 
Such is the knock-on effect of fuel inflation that the supermarket checkout for consumers during the festive period will be unrelentingly brutal. This could well culminate into austerity shopping, with consumers cutting back on bigger-ticket items they typically use to ring in the New Year.

Dark underbelly
There seems to be consensus on well enforced lockdown measures that reduce people’s social contacts in stemming the spread of outbreaks such as EVD, but there is a body of evidence that they hurt countries like Uganda.
Data by the United Nations Children’s Fund (Unicef) showed Uganda kept schools closed for the longest period in the world, which implied children falling behind on their education. Many children missed out on school-based meals and routine vaccinations, social isolation and increased anxiety, and were exposed to abuse and violence.
In some cases, Unicef said school closures led to dropouts, child labour and child marriage. More families were pushed into poverty, creating a deeper economic crisis.
A study by the Economic Policy Research Centre (EPRC) showed lockdowns slowed and, in some cases, halted business recovery. Results showed a higher reduction in business activity and demand for products of 70 percent of businesses in the second lockdown, for example.

Nigerian template
Uganda could look to replicate Nigeria. In 2014, the West African powerhouse was able to deal with an Ebola outbreak that had spread in two states in what was described as “a piece of world-class epidemiological detective work” by the World Health Organisation.
Nigeria did not lockdown, but deployed as per Scientific American “vigilant disinfecting, port-of-entry screening and rapid isolation but also with boot leather and lots of in-person follow-up visits, completing 18,500 of them to find any new cases of Ebola among a total of 989 identified contacts.”

Before Covid-19, a lockdown of the entire country or specific areas was largely alien to Uganda, but it has since become one of the go to solutions.
Based on the previous shutdowns, a lockdown in Kampala would imply wide-scale business closures, stay-at-home orders and a significant halting of both public and private transport services. It would entail cancelling sporting and cultural events, closing retail outlets, restaurants, places of worship, schools and universities.
In the previous lockdowns, the government shut down schools and all other higher learning institutions. There was a shutdown of air, land and sea borders, a ban on all movements of private cars on public roads. Only trucks delivering food items and other essential vehicles—like ambulances and government vehicles—were allowed. Security forces also enforced a dusk-to-dawn curfew.