After COVID-19, Ebola lockdowns drive Ugandan workers into debt

An anti-Ebola advocacy van drives along Kyadondo road amid the Ebola outbreak and alert in Kampala, Uganda October 27, 2022. REUTERS/Abubaker Lubowa

An anti-Ebola advocacy van drives along Kyadondo road amid the Ebola outbreak and alert in Kampala, Uganda October 27, 2022. REUTERS/Abubaker Lubowa

What’s the context?

Still reeling from the coronavirus pandemic, many of Uganda's informal sector workers took out loans to get through Ebola lockdown

  • Uganda lifted two-month Ebola restrictions on Dec. 17
  • Informal workers face increased debt due to earnings loss
  • More support needed for informal businesses, activists say

KAMPALA - Uganda motorbike taxi driver Charles Ssebale fears his vehicle could be repossessed at any moment, having failed to keep up with his loan repayments after the East African nation imposed a two-month lockdown to contain a deadly outbreak of Ebola.

The 41-year-old father-of-seven saw his usual daily earnings - about 40,000 Ugandan shillings ($11) - drop by about 75% during the lockdown, which ended on Dec. 17.

Ssebale said his creditor - an entrepreneur in his community who sells motorbikes - has been incessantly calling him demanding the arrears. The debt is worth about $870, he said.

"I will resume working hard and pay (the loan)," he told Context by phone from Kassanda district, which is located 117 km (72 miles) southeast of the Ugandan capital, Kampala.

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"The people who gave me the motorcycle assured me they will not take it back, despite continuing to remind me to pay in the lockdown times," Ssebale added.

Many informal workers have ended up in debt, campaigners said, since Uganda on Oct. 15 imposed an overnight curfew, closed places of worship and entertainment, and restricted movement into and out of two districts - Kassanda and Mubende.

The measures were aimed at curbing the spread of the deadly Ebola virus, which has infected 142 people and killed at least 55 since the country declared the outbreak in September.

Allana Kembabazi - program manager at the NGO Initiative for Social and Economic Rights - said the restrictions were yet another blow for informal workers who had just been recovering from coronavirus lockdowns and struggling with rising inflation.

"You can't impose a lockdown without having thought through how you're going to feed them, how you're going to provide support to informal sector workers," said Kembabazi.

"The government has done a very poor job of having data to know who the informal sector are, who are those that (are) just going to be most constrained," she said. "We hope the government steps up soon and recognises the predicament of these people."

However, state communication minister Godfrey Kabbyanga told Context that the government had distributed food rations in the Ebola-hit districts, and highlighted that it was also dealing with food insecurity in other parts of the country.

"It was not only Ebola-affected communities that needed relief. We distributed what we had as government," he said.

Motorbike taxis are seen in traffic jam along Jinja Road Traffic Lights of Kampala, Uganda May 27, 2022. REUTERS/Abubaker Lubowa

Motorbike taxis are seen in traffic jam along Jinja Road Traffic Lights of Kampala, Uganda May 27, 2022. REUTERS/Abubaker Lubowa

Motorbike taxis are seen in traffic jam along Jinja Road Traffic Lights of Kampala, Uganda May 27, 2022. REUTERS/Abubaker Lubowa

Informal sector challenges

Although there is no official data on the informal sector, some studies suggest that workers such as motorbike taxi drivers, market traders, manual labourers and domestic helpers account for more than 75% of Uganda's total workforce.

Much of this work is insecure, poorly-paid and often unsafe, according to campaigners, with workers usually earning below minimum wage, not receiving sick leave or paid holidays, and being vulnerable to exploitation from employers and authorities.

The COVID-19 pandemic hit informal workers worldwide the hardest - and one in two people in low-income countries saw their earnings drop, U.S.-based polling company Gallup found.

In Uganda, where more than 40% of the country's 45 million people live in extreme poverty on less than $2.15 a day, according to the World Bank, pandemic-related restrictions were longer and stricter than in many of its neighbouring countries.

Schools and many businesses were closed for two years, inter-district travel and open markets were banned, and bars, nightclubs and other entertainment activities were shut down, leaving many Ugandans unable to earn an income.

A study by Uganda's finance ministry published this month found that less than 5% of informal businesses received any form of financial support from the government during the pandemic.

"This could be attributed to the fact that a large proportion of government support during the crisis mainly targeted formal business," the study said.

A street food vendor sells barbecue chicken to customers, after Uganda’s president Yoweri Museveni reopened the economy which permitted bars and musicians to perform amid the coronavirus disease (COVID-19) containment efforts, in Nakulabye suburb of Kampala, Uganda January 31, 2022. REUTERS/Abubaker Lubowa

A street food vendor sells barbecue chicken to customers, after Uganda’s president Yoweri Museveni reopened the economy which permitted bars and musicians to perform amid the coronavirus disease (COVID-19) containment efforts, in Nakulabye suburb of Kampala, Uganda January 31, 2022. REUTERS/Abubaker Lubowa

A street food vendor sells barbecue chicken to customers, after Uganda’s president Yoweri Museveni reopened the economy which permitted bars and musicians to perform amid the coronavirus disease (COVID-19) containment efforts, in Nakulabye suburb of Kampala, Uganda January 31, 2022. REUTERS/Abubaker Lubowa

'I am suffering'

Social equality campaigners said the government should learn lessons from the impact of the COVID-19 and Ebola restrictions and boost support to workers outside of the formal economy.

Measures could include placing a moratorium on the repossession of vehicles used for taxi services, or providing interest-free loans to informal businesses, they said.

Informal workers interviewed by Context said the Ebola restrictions had left them unable to afford food for their families, cover children’s' school fees, or meet loan repayments.

Namande Agnes, 25, a food seller in Mubende district, 135 km (84 miles) from Kampala, said she had borrowed 450,000 shillings ($123) to invest in her roadside stall, but had fallen behind with her repayments after the Ebola restrictions were imposed.

"I am suffering ... the bank will come and take my land," said Agnes, who sells local fast food such as roast chicken, plantain and chips.

"The one thing (the) government should do is talk to banks on our behalf," she added.

(Reporting by Musinguzi Blanshe; Editing by Nita Bhalla and Kieran Guilbert.)


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