Its been two days since the internet was partially restored but the devastating effects of Uganda’s internet shutdown in 2021 are still fresh for many businesses. The internet was finally restored though social media apps remain down and the only access to them is through a VPN (Virtual Private Network) connection.
The digital economy has suffered greatly and the shutdown was a big hit says Jumia Uganda CEO, Ron Kawamara. He continued to say, “The shut down was not prior communicated and as a result vendors and business owners were losing money for every day that the internet was down.”
For a blackout that lasted almost a week, the disruption caused by the effects of Uganda’s internet shutdown in 2021 have been ruinous. Worst of all with no prior communication, many were caught off-guard and didn’t have the opportunity to divert to alternatives.
For an online retail company like Jumia, online delivery is one of its most essential services. In the presence of last week’s circumstances, the damage that was done is extensive as deliveries that were scheduled within those 5 days were not made. In addition, customers could not access the company to do their online shopping activities which result in the company losing huge amounts of money. This has led to a number of frustrated customers says Jumia.
The internet revolution has enabled people to carry out most of their transactions online. This has become a reliable means because of such great convenience and safety along with the privacy that it ensures.
According to NTV, seeing as the devastation continued, the Ministry of Finance wrote to the Prime Minister Ruhukana Rugunda informing him of the ongoing effects of Uganda’s internet shutdown in 2021 on the economy if the government continued to let the blackout happen.
The Government has also felt its fair share of its own actions since the Bank of Uganda relies on the internet to carry out it’s banking. This has resulted in delays in payments like salaries and pension.
For the tax collecting body URA, various entities could not file returns last week for taxes such as withholding tax and VAT which contribute hundreds of billions to the economy and taxes could not be remitted to the consolidated fund.
The effects of Uganda’s internet shutdown in 2021
The aftermath of the internet shutdown leaves a number of businesses with the burden of dealing with disgruntled customers. Ron Kawamara the Jumia CEO, went on to say that they now find themselves wasting more time and money to clear the backlog as a result of inactivity for that long. The company is also trying to dig itself out of the lost transactions and reconcile the cash that was in transit.
Fintechs all over the country are also struggling to pick up the pieces after millions of online transactions could not be carried out. An estimated shs66.6 billion is at stake and could lead to a huge decline in the growth of the Financial Technology industry. The real effects of Uganda’s internet shutdown in 2021 will be felt gradually and could have a significant impact on the country’s GDP.