LAHORE: The retail and wholesale sector in Pakistan has feared an accumulate loss of Rs900 billion during 45 days of the coronavirus-led lockdowns, while millions of jobs are also on stake due to closure of this sector, Pakistan Today learnt.
The Chainstore Association of Pakistan (CAP), three weeks ago, wrote a letter to the Prime Minister and demanded liquidity support. However, the association complains that PM did not pay any heed to the sector’s suggestions.
CAP Chairman Rana Tariq informed this scribe that the retailers have faced almost Rs900 billion during the lockdown period, whereas the retailers and wholesalers were those who contributed around 16pc to the national GDP, i.e. Rs7 trillion annually.
He also informed the direct employment in the retail (and wholesale sector) is 18pc of the total workforce, i.e. 9 million people and their families and if each family has an average five members, almost 45 million people are dependent on the retail sector of Pakistan.
CAP member Asfandyar Farrukh, who is also the Managing Director at Hub Leather said, “We are trying very hard to sustain most of our workforce and manage other fixed costs that are associated with a documented retail business such as rents, utilities and high taxes. Over the last 19 years, our biggest investment has been in our people many of whom have been able to upgrade their skills and become main bread-earners for their families.”
“It is tragic that the retail workforce from the middle class is being neglected and over a month has passed without any meaningful relief,” he said, adding the retailers feel very overlooked when the government announces hundreds of billions in relief primarily for exporters and big businesses that are already leveraged.
Farrukh said the State Bank of Pakistan’s scheme seems good on papers, but private banks are unwilling to take the risk on SMEs especially where collateral and quick approval is an issue. “There is still some hope that the government will announce relevant measures and ensure fast delivery to those who need it.”
Altaf Hashwani, who is Director at Sana Safinaz, told this scribe that, “The organised retail businesses need government’s support like export sector and others, if not more.
“Unfortunately, the SBP’s relief funding scheme doesn’t adequately address the needs of small and medium enterprises. Our teams are an integral part of our business and we want to retain our workforce, but without a customised package, the organised retail sector will be forced to shed jobs, leaving a large skilled and semi-skilled workforce without employment and negatively impacting the growing middle class in the country.”
Asad Shafi, the CEO at Cross Stitch, was of the view that the retail brands are the face of our workmanship and it would be a sad state of affairs if the government doesn’t provide relief to this struggling sector.
“With a complete collapse of revenues how does the government expect a retailer to utilise this scheme,’ he questioned and said the government is basically offering us to book a loss, take a loan to cover the loss and pay interest on it.
“We are unable to meet our current financial liabilities including banks and vendors. How will we further add debt and pay interest in a model where there is no revenue,” he noted.
Speaking to Pakistan Today, Managing Director of Firhaj Footwear (Hush Puppies Pakistan) Mohammad Qasim said, “This sector has been hit most adversely during this pandemic due to lockdowns, not just in Pakistan, but also globally. If the current situation persists for a longer period, millions of semi-skilled and skilled people will be losing their jobs.”
Poor people cant afford this lockdown but still we have to fight with unity with this virus
Even in crises, rich try to make a profit. While the poor try to pick the peace in pieces left over. Where is 1 Pakistan not 2 Pakistan in practical terms.
Corona might be one thing, but still we need to look at things from a systematic level. A sudden crises and 10% of the populace goes below poverty line. We can’t go further the next 70 years on the same lines.
All profit making enterprises from Teleco’s to Power Sector were privatized .Now if the private sector starts hammering out losses on to employees. Where will we the Pakistani’s go?