East Africa: Central Banks Ramp Up Coronavirus Response

Mar 31, 2020 | Tanzania Daily News - All Africa

Central banks of the East African Community member countries are contemplating swift interventions in response to the coronavirus crisis amid calls on regional governments to implement significant economic stimulus packages.

The COVID-19 outbreak seems to devastate economic activities, bringing life to a standstill as many countries are taking bold measures to control further spreading of the pandemic.

Such measures include lockdowns, curfews, and quarantines; meanwhile, businesses such as hotels and tourism are shut down.

The East African Business Council (EABC) Chief Executive Officer (CEO) and Executive Director, Dr Peter Mathuki unveiled to the 'Daily News' that the Monetary Policy Committee (MPC) of the Central Bank of Kenya (CBK) met on 23rd March and analyzed the impact of the Covid-19 to Kenya's economy.

In light of the adverse economic outlook, said the former East African Legislative Assembly (EALA) member, the MPC divulged some policy actions to prevent the Covid-19 health crisis from becoming a severe economic and financial crisis. As of yesterday, Kenya had reported 42 cases of the novel virus.

"The CBK lowered the Central Bank Rate (CBR) from 8.25 per cent to 7 .25 per cent, reducing the Cash Reserve Ratio (CRR) from 5 .25 per cent to 4.25 per cent, released KES 35.2 billion as additional liquidity availed to banks to directly support borrowers that are distressed as a result of Covid-19," said Dr Mathuki.

The implications of the measures mitigate the adverse impact of the Covid- 19 to Kenya's economy and more importantly to the financial sector. Read more on All Africa

Source: All Africa