Five sectors hold the key to the realisation of President William Ruto’s economic turnaround, this is according to the recent Budget Policy Statement.
Since coming to office in September 2022, Ruto’s administration has been implementing calculated policies that have put the country on a sustainable economic growth.
Analysis of the BPS showed the Ruto administration is targeting agriculture, micro, small and medium enterprises economy, housing and settlement, healthcare and digital superhighway and creative industry to achieve the bottom-Up Economic Transformation Agenda.
“The economic indicators point to good news. Inflation is down while our GDP has grown,” President Ruto said during this year’s Jamhuri Day celebrations.
The sectors have received substantial budget allocation in the one and a half year Ruto’s administration has been in power.
Digital Super Highway just like housing, being key driver for the country’s transformation, are meant to create jobs and growth in the country’s economy.
Ruto’s regime has gone flat-out in expanding high-speed internet access nationwide to ensure remote parts of the country reap the economic benefits of the digital space in a cost effective way.
To enhance the agricultural sector, Kenya Kwanza has registered farmers, provided crop-specific fertiliser, rolled out reforms in the tea, coffee, sugarcane and edible oils sectors and availed mobile driers.
The government is also not lagging behind in the provision of affordable credit liberating entrepreneurs from exploitative money lending services.
To that effect, the Hustler Fund has grown to become the largest financial inclusion programme.
“The agenda places special focus on increased employment, more equitable distribution of income, social security while also expanding the tax revenue base, and increased foreign exchange earnings,” read part of the BPS.
“To realise this, the government has targeted nine value chains with the largest impact on jobs creation and economic recovery as follows: leather, cotton, dairy, edible oils, tea, rice, blue economy, natural resources including minerals and forestry and building materials.”
On the healthcare, the administration is rolling out the Universal Health Coverage plan, ensuring that every Kenyan will have access to free healthcare services at all Level 1, 2, and 3 dispensaries and health centres across the nation.
Despite the global supply disruptions due to ongoing conflicts in Eastern Europe and the Middle East; high interest rates limiting access to credit and exacerbating debt servicing costs; significant losses and damages due to frequent extreme weather events, the interventions by the Kenya Kwanza administration has slowly started bearing fruit.
To mitigate the disruptions, Ruto’s administration has continued to implement crucial interventions and policies to reduce the cost of living and improving livelihoods, while at the same time fostering a sustainable inclusive economic transformation through the Bottom-Up Economic Transformation agenda.
“Despite the challenging environment, there is notable significant success following the various interventions rolled out during the past one year by the government. Specifically, economic vibrancy has started,” the BPS statement indicates.
“The economy remained strong in the first three quarters of 2023, growing by an average of 5.6 per cent, a demonstration of resilience.”
This growth was well above estimated global and Sub-Saharan African region average of 2.9 per cent and 3.3 per cent, respectively.
According to the National Treasury, the economy will grow by 6.3 per cent this year, even as the country navigates through a high interest rates regime and major global risks.
The growth, Treasury indicates, will be driven by raising agricultural productivity as the government implements key components of the Bottom Up Economic Transformation Agenda, which is President Ruto’s plan to drive growth, create wealth and jobs.
A recent survey by the Infotrak Research and Consulting showed a significant shrink in the number of Kenyans who believe the country is headed in the wrong direction.
This confirms that the interventions being put in place by the current administration have started bearing fruit.
In March 2023, the pollster indicated that up to 61 per cent of Kenyans were dissatisfied with country’s economic direction but the same has dropped by three per cent in the study released on Thursday last week.
“Comparatively, there is a slight drop of three per cent of those who say the country is headed in the wrong direction,” report showed.
Kiharu MP Ndidi Nyoro told the Star that the country under Ruto administration, had to make difficult decision to bring the economy back on track.
Some of the difficult decisions, according to Nyoro, included postponing some of the capital expenditures and going slow on foreign borrowings.
Nyoro also chairs the National Assembly’s Budget and Appropriation Committee.
“The elephant in the room has remained the high level of public debt. Are we out of the woods? he posed.
Settling debt is a gradual process. We cannot be off the hook within one or two years, he said.
“For the last 10 years before we took over, Kenya accumulated about Sh8 trillion in debt. When the former president Mwai Kibaki left, the public debt was around Sh1.6 trillion or there about. When we took over, it was just about Sh10 trillion.”
“So, it is not an issue that you can do at ago. It’s gradual.”
The Infotrak survey was conducted on March 8 to 9, 2024 and covered all 47 counties and eight regions of Kenya.
Kenya is among the only three countries, of the 10 largest economies in the Sub-Sahara region, that are growing at rates that are higher than their long-term average, according to World Bank.
This is alongside Côte d’Ivoire and the Democratic Republic of Congo.
The projections are contained in the World Bank’s latest Africa’s Pulse report.