Happy New Year my dear readers!
This is the third straight year that I have been writing for this paper, although my articles have lasted longer more than 10 years since I wrote for The Star under Catherine Gicheru as editor.
So welcome to 2023, a year that holds promise for all Kenyans now that the 2022 election cycle has come and gone. What will be in the minds of people is the economic recovery by ensuring there is money in people’s pockets (or M-Pesa).
The cost of living is still very high and the net effect of the government’s efforts to subsidize production rather than consumption can only bear fruits in the medium term. For example, President William Ruto has cancelled the subdivision of the 10,000 acres of the Galana-Kulalu irrigation scheme, ordered another 10,000 acres to be added to the scheme within six months and that another 350,000 acres be prepared for irrigation once a proposed dam is constructed in the area.
This project that collapsed due to corruption and mismanagement has the potential to feed the country and therefore reduce food shortage.
In addition, the withdrawal of other subsidies in key sectors will help various industries return to normalcy after the effects of Covid-19 pandemic, and the slowdown usually occasioned by the election cycle.
In fact, it’s during this calendar year that schools shall regain the lost time fully due to the adjustments made during the height of the pandemic, with the first term of 2023 expected to commence on January 23 for the majority of schools across the country.
Moreover, the commencement of some taxes that had been suspended such as the 20 per cent excise duty on mobile money transfers , the one per cent annual turnover tax, the 15 percent capital gains tax on property transfer, and 16 per cent vat tax on online transactions shall weigh heavily on many businesses.
The government is keen on raising Sh2.1 trillion for its Sh3.64 proposed budget under the Budget Policy Statement. This means domestic borrowing shall continue, with banks preferring to lend to government rather than other investors. The target is to raise our revenue to GDP ratio from the current 14 per cent to 25 per cent in consonance with our lower middle income country status.
It’s, therefore, imperative that manufacturing and value addition of agricultural and other products be prioritized to spur economic growth. The tech startups are also generating good revenue, with 63 Kenyan startup firms raking in $504 million (Sh62.4 billion) in 2022, according to Disrupt Africa. This is a new area of growth.
Our country’s GDP is currently estimated to be $113 billion, according to the IMF in 2021 and is ranked seventh on the continent.
However, countries such as Tanzania are working hard to overtake us economically, by constructing their SGR that will link the port of Dar es Salaam to Burundi, eastern Congo and Uganda. Kenya, therefore, may need to ensure that its SGR is extended to the port of Kisumu from Naivasha.
However, the containers are returning to the ports empty since Kenya is manufacturing fewer products for export, apart from raw materials that are being extracted from us. With the entry of DRC into the East African Community, Kenya should be keen to leverage on its 90 million people market, if to increase business and economic growth.
Kenya is essentially a transit economy and most of the economic activities lie along the old railway. This gives credence to the Lamu Port, South Sudan, Ethiopia Transport (Lapsset) corridor that would be highly beneficial to the country.
Our fiscal headroom, however, needs to be managed carefully to prioritize these investments for our country. We should always ask ourselves, whose goods are we transporting?
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Kawira Mwangaza’s impeachment was overturned by a select committee of the Senate chaired by Kakamega Senator Boni Khalwale, the Majority Chief Whip.
Going through the 89 page report, one cannot help but laugh at the manner in which the Meru MCAs prosecuted their matter. There were five charges in total, each having several grounds, of which not a single one was upheld by the 11-member select committee.
The charges were, to say the least, baseless ranging from how the first gentleman behaved, who abused who in a public meeting, how people were hired on the streets to sweep markets, how an advocate of the High Court isn’t qualified to be the Meru county spokesperson, how the governor violated the Constitution by forcing herself to a gazetted sitting of the County Assembly to make her first address as per the law and other rumors and jokes of such nature.
The real elephant in the room is that the MCAs cannot countenance a woman as a governor in that region.
On her part, Kawira has also been tactless due to the baggage she carries into that office obviously out of lack of experience by virtue of being a pioneer woman governor.
Both groups must overcome these hurdles to make their county attain its development goals. We have to live with the reality that more and more women shall occupy positions that were previously a domain of men!