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Jan 25, 2024
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The World Health Organization has declared COVID-19 (coronavirus disease 2019) a global pandemic. As the cases of novel coronavirus disease multiply and the governments take remarkable measures to restrict the spread, it has created a drastic impact on the UAE businesses and the economy as a whole.
Coronavirus belongs to a large family of viruses and has not previously infected humans. Fever, cough, shortness of breath and breathing difficulties are some of the common symptoms. In more severe cases, the infection can cause pneumonia, severe acute respiratory syndrome and even death.
COVID-19 originated from China's seafood market in Wuhan in December 2019. Late in February 2020, the World Health Organisation (WHO) named the novel coronavirus "COVID-19". The virus has spread into 195 countries and territories around the world.
The World Health Organisation declared the virus as a global pandemic on 11 March 2020. The first case of the pandemic was reported in UAE on 29 January 2020. 435,366 confirmed coronavirus cases reported and the death toll has crossed 19,000 globally as on 25 March 2020. UAE has so far reported 198 COVID cases, 41 recoveries and 2 deaths.
COVID 19 has affected the normal life of UAE people and the businesses alike, shutting down organizations, schools, entertainment spots and open parks. The Tourism Industry, Beverage Industry, Educational Institutions, Transportation and the Retail businesses which are all the pillars of the nation's economy are affected badly. Restaurants, hotels, airports and parks are now empty affecting the business of the common men.
Let’s take a look at the measures the UAE Governments have taken to compact the disease.
The country suspended all visa issuance and imposed a mandatory 14-day quarantine for anyone entering the country.
The issuance of all types of labour permits is also suspended by the Ministry of Human Resources and Emiratisation. This includes drivers and domestic workers.
The UAE government announced a ban on its citizens travelling overseas.
While major corporations and industries have the potential to sustain the impact of COVID-19, small or local businesses are facing a tougher outcome. They are facing a crisis at a large extent that would directly impact their day to day lives.
Car rental dealers and drivers are facing huge disappointment in their business since transportation and tourism are limited in the UAE. Appointments to Chinese customers dropped since the month of January.
When Saudi Arabia ended flights to and from the United Arab Emirates as a measure of infection control and prevention, it put a temporary stop to the biggest source of customers and income.
Dubai’s hotel businesses faced global travel slowdown leading to reduced hotel occupancy rates.
Chinese shoppers make up to 40% of the global market for goods. UAE faced a drastic reduction in big-spending by the Chinese tourists which hit the retailer stores.
Small businesses offering lifestyle activities for both tourists and residents, such as events, yachts, desert safaris are also affected. Apart from the lack of income, they also have to find out funds to refund the customers who made bookings earlier.
Yoga centres and gym centres are empty. Labourers and workers in the construction field, job agencies and coaching centres are struggling to find a financial outcome.
Similarly, other UAE businesses and industries like food production, education, childcare facilities and travel agencies have stopped their operations due to COVID 19. Event management companies cancelled their events as the government ordered them not to conduct weddings, corporate functions, brand launches, fashion shows and other social gatherings. The consequences of this situation for SME (small-to-medium enterprises) is huge and unimaginable in the coming days.
To recover from COVID 19 pandemic, various consolatory measures are taken by the UAE government and the private sector. During this critical situation, it is very important for small and medium businesses to update on those measures.
1. COVID 19 Help- Steps Initiated by the UAE Government
The government in Abu Dhabi declared $27 billion to help organizations and banks hit by the large drop in economic activity.
Subsidies are allowed on electricity bills for startups to promote small and medium enterprises. AED 5bn is provided as a water and electricity subsidy for citizens and for commercial & industrial purposes. Whereas, AED 3bn is set aside for the SME credit guarantee programme.
The AED 1bn market maker fund is initiated to enhance liquidity and sustain a balance between supply and demand for stocks.
A series of stimulus packages are launched by the Abu Dhabi Executive Council to boost small and medium enterprises and ease the availability of loans to local companies.
Up to 20% rebate on rentals for the restaurant, tourism and entertainment sectors are provided to tackle COVID 19 effects.
Tourism and municipality fees for tourism & entertainment sectors are also suspended for this year.
Moreover, new committees are formed to review lending options to support local companies.
2. Actions Initiated by the Private Sector Businesses
Employees of various businesses and firms are given the option to work from home to ensure proper social distancing.
Thermal detectors are installed at various malls and institutions with sanitisers and masks to prevent spreading of infection at business firms.
Cleanliness and hygiene are ensured at private buildings. Lift buttons, trolleys and staircases are cleaned thoroughly to maintain safety.
3. Help from the Financial and Banking Sector for the UAE Businesses
Various UAE banks offered to help their clients, individuals and organizations affected by the coronavirus outbreak.
First Abu Dhabi Bank (FAB), Abu Dhabi Commercial Bank (ADCB) and Abu Dhabi Islamic Bank (ADIB) have taken steps to recover from the coronavirus crisis on individuals and businesses and ultimately the economy.
Relief for retail customers includes payment deferral of 3 months for retail loans of affected customers with zero charges and interest waived for the deferral period, a payment deferral of 1 month will be available on request for all customers holding Personal Loans, Auto Loans and/or Mortgage Loans with no service charge.
For those individuals or owners of the business who are affected by the COVID outbreak, loan instalments are deferred and interest will be waived for a period of up to 6 months, subject to the appropriate level of scrutiny to be conducted by the bank.
For SME customers, FAB will defer up to three months of instalments for all loan types to tackle the impact on their cash flows, to provide further support in loan restructuring or deferment.
While you receive all the help and support from the government and financial agencies, it is also important that you equally start thinking about self-recovery options. Some of the options which we would love to suggest to you are:
1. Keeping your Customers on the Loop
During this Pandemic situation, communicating with your customers is vital. Let them know what steps you and your employees have taken to keep your business alive and safe. Let them also know that you value them and their requirements and that you’ll do everything to address their needs once it is safe to do.
2. Keep your Employees Informed and Trained
It is equally important to educate your employees and to give them proper guidance through Corporate Training. This Training can essentially do the job of handling any stressful situation. Skill development from time-to-time will help them to keep up the competition. You can also gather authentic information from reliable sources and share it with your employees to keep them updated.
To recover from any crisis, a business must have a proper plan in place to execute even in the worst situations. All the businesses, whether small, medium or large must have a disaster management plan in place to overcome any crisis. Keep improving the methods of communication and business dealings, while, maintain your customers and manage your employees. Finally, take our word for your business- be adaptive to the change, improvise the old methods for new, overcome any challenges as it may come and always stay safe.
