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Effects of Nation-wide Blackouts on the Economy

BY Soko Directory Team · June 7, 2016 02:06 pm

Electrical Power, in the short span of two centuries, has become an indispensable part of modern day life. Our work, leisure, healthcare, economy, and our very livelihood depend on a constant supply of electrical power. One may not believe it, but even a temporary stoppage of power can potentially lead to relative chaos at train stations and airports, and also big monetary setbacks in in investment trading companies and possible loss of life in a country.

Access to power expands the number and variety of business and job opportunities available in the country. Availability of electricity means that all kinds of businesses, starting from multinational ones to local ones such as hair salons, laundromats and welders will be running smoothly. Power crisis effects corporate businesses, multinational companies and the national health delivery.

When power failures are experienced nationally, this means that a lot of activity is forced to go on a standstill. This means that a lot of money will be lost for that period that power will not be available, lives will be lost since hospitals with patients in the Intensive Care Unit (ICU) depend on the power in their process of saving lives together with other activities in the health sector, manufacturing industries will stop working, thus leading to a lot of losses being experienced. Rampant poor electricity supply is one of the biggest barriers to the growth and development of the economy of Kenya.

Manufacturers, commercial building owners, warehouses, farmers and other small businesses like salons and barber shops all use electricity and an extended outage usually translates to losses and additional expenses from using generators. Kenyan homes and industries experience more than 600 hours of outages per annum compared to 120 hours or five days per year in South Africa, according to IEA’s report titled Africa Energy Outlook 2014.

Availability of power also leads to the creation of new markets, businesses and job openings, which provide more opportunities for individuals to earn an income and lift themselves, their families and their communities out of poverty. Unreliable power supply in Kenya has been said to be among potential key contributors to the large productivity gap. Insufficient and unsustainable power supply tends to be is a major problem.

People who can testify on the effects of power blackouts include those who have lost their loved ones due to life-support systems power failures in hospitals, factory workers who have lost their jobs as a result a one-day power failure, students who have struggle to study in the night due to lack of electricity, entrepreneurs who cannot bear the cost of running generators to keep their businesses running and for that matter, have had their businesses collapsed.

 

Soko Directory is a Financial and Markets digital portal that tracks brands, listed firms on the NSE, SMEs and trend setters in the markets eco-system. Find us on Facebook: facebook.com/SokoDirectory and on Twitter: twitter.com/SokoDirectory

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