Browsing: fiscal policy

The sustainability of Kenya's debt remains a significant concern not only for authorities but also for the populace, financial institutions, and other key stakeholders.

Kenya’s economy has recovered significantly under challenging circumstances amid a global economic downturn and is anticipated to grow by 5.7 per cent in 2022.
Despite significant setbacks, Kenya’s structural reform strategy, which focuses on enhancing governance, has progressed.
According to the Central Bank of Kenya, 57 cents of every dollar spent by taxpayers goes towards the country’s growing debt.

Economic ...

Already have an account? Log in

Get 50% off this Black Friday

Save on an annual digital subscription and explore your interests

Digital Subscription – Monthly

Be informed with the essential
news and opinion

$5 per month

Digital Subscription – Annually

Be informed with the essential
news and opinion

$40 per year

 

In a bid to combat inflation, central banks must evaluate the advantages against the possible adverse effects on their transparency and credibility, particularly in situations where monetary and fiscal policy frameworks are not firmly established.

  • Monetary and fiscal policy are two powerful tools that governments use to steer economies.
  • Public debt ratios have peaked at their highest levels in more than two decades, and several low-income African nations are in or near economic shutdown.
  • Experts have projected that total inflation in sub-Saharan Africa will reach 12.2 per cent in 2022.

Understanding monetary and fiscal policy

Monetary and fiscal policy are two powerful tools that governments use to steer economies. When applied correctly, these tools can similarly stimulate an economy and slow it down when it heats up.

Fiscal policy is when a government uses its spending and taxing powers to impact the economy. Monetary policy relates to the techniques a …

President Hichilema’s plan for kickstarting the economic recovery in Zambia included taming inflation, job creation for the youth, restoring the confidence of international investors and addressing external debt.

  • Hakainde Hichilema has guided Zambia towards economic recovery and stability since taking office in August last year.
  • COVID-19 pandemic, climate change, high debt portfolio and other headwinds decimated Zambia’s economy in 2021 to less than 3% of GDP.
  • The proven stability approach sets an example for other African nations looking to bounce back from a raft of economic and inflationary pressures.

The dawn of hope for Zambia

Hakainde Hichilema is one of the most successful businesspersons in Zambia. During the presidential election in 2021, Hichilema contested on a United Party of National Development, in which he is the party leader.

The six-time presidential candidate was, in August 2021, declared the winner of the presidential poll. His victory ended incumbent President Edgar Lungu’s

The confirmation of William Ruto as president indicates that Kenya will remain on track with its IMF program and plans to strengthen medium-term public finances, but a sovereign credit 2022 ratings downgrade remains inevitable in the subsequent months.

  • Over the last decade, Kenya has implemented significant political and economic changes.
  • The new administration will make headway on Kenya’s fiscal consolidation.
  • Even if Ruto keeps his promises, it may be “too little, too late” to avert at least one sovereign decline by the end of 2022.

Kenya’s political and economic structure

Over the last decade, Kenya has implemented significant political and economic changes. The changes have led to sustained economic growth, social progress, and political stability. Poverty, inequality, transparency and accountability, climate change, sustained poor private sector investment, and the economy’s susceptibility to internal and external shocks remain essential development issues.

Kenya’s new constitution ushered in a new economic and political …

The Treasury has directed Cabinet Secretaries and CEOs of parastatals to draft Kenya’s 2023 budget based on policies implemented by President Uhuru Kenyatta’s government, despite uncertainty about when the next Head of State would take office after Raila Odinga filed a petition at the supreme court.

  • A hazy outlook has prompted the Treasury to begin the budget-making process under present rules.
  • According to Yatani, the formulation of the FY 2023/24 and medium-term budgets will concentrate on the targeted economic intervention.
  • A successful petition would invalidate the presidential election, necessitating a new vote 60 days after the ruling.

Directions by Treasury

The Treasury has directed Cabinet Secretaries and CEOs of parastatals to draft the 2023 budget for the fiscal year beginning July 2023 based on policies implemented by President Uhuru Kenyatta’s government, despite uncertainty about when the next Head of State would take office.

Treasury Cabinet Secretary Ukur Yatani has urged …