MSMEs not only play a vital l role in providing employment opportunities but also contribute to the socio-economic development of the country, notably in their role as facilitators for the transition to an industrial society. Social unrest, triggered by longstanding issues that could now be aired in a more open civic and political environment, has led to conflict, loss of lives and property and, at the last count, 1.7 million internally displaced persons (IDPs). The macroeconomic and development situation was challenging, evident in slowing but still high growth, the risk of debt distress, low levels of domestic resource mobilization, high inflation, high unemployment, not least among youth trying to find opportunities in an economy with elevated levels of informality, low forex reserves and significant pressure on the exchange rate of the Birr. Ethiopian small business also faced some major challenges as it was struck by COVID-19. In these circumstances, it is vital to understand the scale, nature, and depth of social and economic impacts to design an appropriate and effective policy and programmatic response, whether at the country, regional, or global levels. While the trajectory of COVID-19 is still at its initial stages in the region, the repercussions of development elsewhere are already being felt strongly. However, facing the wrath of the coronavirus pandemic, most of these firms face difficulty surviving in the current climate for even above 5 months, Ethiopian press agency ( 2020).Īccording to ONE UN Ethiopia ( 2020) assessment report, Sub-Saharan Africa (SSA), including Ethiopia, are unlikely to escape the direct and indirect effects of the pandemic and the attendant global crisis.
Recognized by the government as a driver for economic growth and job creation, small businesses, or more commonly referred here as small and micro enterprises as the lexicon goes, the sector has been growing steadily for the past decade or so. Since the first case of pandemic surfaced in Ethiopia, the government has been taking various sweeping health and economic measures to mitigate its impact. Small businesses are the backbone of any economy, and with the ripple effect of COVID-19 on economies all over the world, their protection has become important more than ever. To prevent unemployment, poverty, and food insecurity rates from further skyrocketing during any time, small and medium enterprises around the globe can and should play a crucial role. This virus has triggered a substantial short-term economic contraction, shuttered many firms, whether big or small, thrown tens of millions out of work, and has other effects on business activities. It is a systemic shock with profound implications, both in the short- and medium- to long-term. COVID-19 is a massive health crisis BUT also much more. This virus is highly transmittable and has spread with inconsistent progress in every corner of the world without any variance. Based on different reports, it is the most horrible global crisis since WW II. Reduce expenses be open to their employees about their finances and keep marketing, use different alternatives to deliver their product, and recover from the crisis.ĬOVID-19 is shuddering the world economy and it is a pandemic making a giant distractions to life and livelihoods as well as social and economic systems in the world. Besides, small business owners should manage expectations and communicate with staff, suppliers, banks, and customers throughout this coronavirus frightening. To support these businesses, the government should use different mechanisms by cooperating with wealthy peoples and other non-governmental organizations.
The secondary data analysis result shows that many small and large businesses are suffering challenges and this unprecedented coronavirus crisis has caused destruction for many businesses in the globe and it is challenging to survive with reduced revenue, jobs lost and life slowing down and weak marketing performance even difficult to keep a calm head and their business alive. Furthermore, this study was conducted through both qualitative and quantitative research approaches. Methodologically, the study deployed secondary data analysis following a descriptive research design.
Mainly this study was aimed at demonstrating the challenges of small businesses during the corona virus pandemic in developing countries, specifically in Ethiopia.