There was not much promise going into this Budget, especially with the news of the soaring wage bill, except for this year’s theme — “Transformation for Shared Prosperity.” And so on his first outing, Cabinet Secretary for Finance Henry Rotich did little to assuage our fears. In fact, his was a Budget of unpretentious knives and sad reminders.
Imposing a 1.5% tax on all imported items to fund railway expansion is sure to hurt even the poorest among us.
Of course he heralded the dawn of a new era — but perhaps more in a political fashion than in the economic sense. In his own words — elevating the economy to a higher and sustainable growth path, creating decent jobs, and significantly reducing poverty while preserving macroeconomic stability — Mr Rotich summarised the dreams of a hopeless nation.
This is a laudable dream whose realisation will take painful sacrifices. Rotich had the presence of mind to draw us to stick with reality — that while we have come a long way, there is still an arduous journey ahead and one that we must face and deal with.
Strategic interventions are planned to ensure we create one million jobs a year. Of course the proof of the pudding will be in the eating! While we as a nation are strategically placed to exploit the future, there is need to stay focused. It is one thing to say we will create jobs, but actually getting there takes not just political goodwill but planning.
Within this tight envelope, the Finance Secretary acknowledged that the private sector has a large role to play in our future. What will liberate this sector, however, is an environment free from corruption, red tape, and low energy costs.
Specific infrastructure projects were in his sight with generous allocations. This is sure to change the face of Kenya as an investment destination. This, however, is not all.
Security issues
The ease of doing business must be addressed and while it was mentioned, a lot of it is was what we had heard before. One hopes that this time they really mean business and something will happen.
Security was given special mention and this specifically is a good thing. Investors and business in general tend to stay away when there are major security issues. In particular, one of the backbones of our economy, tourism, is significantly affected due to security concerns.
Perhaps the most notable thing about this Budget is an allocation to irrigation — which in the long term, should contribute to the country’s food security.
Perhaps what wasn’t planned for but which has an impact on food situation is the climate change. This global phenomenon is going to play a big part in any plans to achieve food security and the earlier we get down to dealing with it, the better for us.
Measures announced including making it easier to register a business, obtaining necessary permits, reforms of the tax system and a new Biashara Kenya Bill aimed at creating a one-stop shop is supposed to be good news, but haven’t we been down this road before?
