COVID-19: Managing Cash flow during a period of crisis - Part 2
The outbreak of the Novel Coronavirus (COVID-19) pandemic continues to have economic and financial ramifications with uncertainties on the full global recovery. The number of infections has increased rapidly over the past few weeks, with more than 1.5 million confirmed cases and more than 80,000 deaths as at the beginning of April.
The United States of America has become the epicentre of the pandemic, recording more than 350,000 cases and Italy reports the world’s highest number of deaths- over 15,000 deaths since the start of the pandemic.
Ghana has equally seen a rapid surge in the number cases, adding more than 150 cases in a week, and taking the nationwide total to 287 cases, 31 recoveries and 5 deaths as at the beginning of April. In view of this, the Government of Ghana has imposed a partial lockdown in the Greater Accra Metropolitan Area and the Greater Kumasi Metropolitan Area for a period of two (2) weeks, effective 30 March 2020 to limit and contain the spread.
In addition, the Government plans to undertake the following initiatives:
- Release of a minimum of GH¢1 billion to households and businesses;
- Make available a GH¢3 billion facility to support the pharmaceutical, hospitality, service and manufacturing sectors;
- Get banks to roll out a six-month moratorium of principal repayments to entities in the airline and hospitality sectors;
- Absorption of water bills for all citizens for the next three (3) months;
- Tax exemptions for all health workers for the next three months and an additional allowance of 50% of basic salaries for frontline health workers.
As some parts of the country go on partial lockdown, a sharp decline in demand is expected as consumers stay at home and stop spending. Business activities will slow down considerably and companies risk being unable to manage the disruptions.
This article which is part 2 in the series, will suggest more ways organisations can mitigate damages to their business during this volatile event.