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State proposes Sh6.8b for trade docket in next budget

BUSINESS
By Fredrick Obura | May 21st 2021

President Uhuru Kenyatta when he officially opened the 114km Garsen-Witu-Lamu road on his way to Lamu County to preside over the operationalization of the first berth of the new Lamu Port.[Standard]

The government has proposed to allocate Trade and Industrialisation ministry Sh6.8 billion in the 2021/2022 financial year, inline with the Big Four Agenda.

The Big Four Agenda is part of President Uhuru Kenyatta legacy projects.

According a report by the National Assembly committee on trade and industrialisation, this figure is proposed by the National Treasury Cabinet Secretary Ukur Yatani in the next budget, to be unveiled early next month.

Of this amount, Sh2.2 billion is for recurrent expenditure and Sh3.7 billion is for development expenditure.

An analysis by the committee states that the key outputs for the coming financial year and medium term period will be promotion of industrial development and investments, standards and business incubation, development of Athi River textile hub and Special Economic Zones (SEZs).

The department is also expected to modernise the foundry plant at Numerical Machining Complex (NMC), a one-stop-shop centre for investment facilitation, modernisation of Rivatex machinery and cotton extension subsidy and provision of credit to MSMEs.

Others will be construction and equipping of industrial research laboratories in Nairobi and upgrading and completion of stalled infrastructural projects at KITI.

The committee chaired by Adan Haji also oversees the state department of cooperatives, state department for trade and enterprise development, state department for cooperatives and the National Treasury.

In the next financial year and over the medium term, the state department for cooperatives will implement one programme - co-operative development and management. Key targeted outputs include registration of SACCOs, rehabilitation of Coffee Cooperatives, restructuring the Kenya Farmers Association and a Co-operative share trading platform.

The single programme in the 2021/2022 Financial Year also includes increasing coffee production, value addition technologies adopted by co-operatives, modernisation of new KCC processing plant and completion of Co-operative Management Information System (CMIS).

The submitted budget estimates is proposing to allocate the cooperative department Sh1.6 billion of which Sh1.2 billion is for recurrent expenditure and Sh374.6 million is for development expenditure.

In an analysis seen by Standard, the state department for trade and enterprise plans to implement one programme in the coming financial year under which it will enhance trade development and promotion.
The key targeted outputs include completion of negotiations for a bilateral free trade agreement between Kenya and the US as well as Kenya and UK.

The department will also focus on seizure and destruction of counterfeit goods, promotion of domestic trade and entrepreneurship through construction and completion of CIDC and operationalisation of Kenya National Multi-Commodities Exchange Limited (KOMEX) trading platform.

“The submitted estimates for the financial year 2021/22 is proposing to allocate state department for trade and enterprise Sh3.3 billion of which Sh2.1 billion is for recurrent expenditure and Sh1.2 billion is for development expenditure,” read an analysis from the committee.

The budget estimates have been prepared against a background of a recovering global economy from effects of the outbreak and rapid spread of the Covid-19 pandemic.

There is still uncertainty on when Kenya and the entire world will contain the pandemic, however, there are expectations of a vaccine powered economic recovery with continued reopening of economies.

In the FY 2021/22 revenue collection including Appropriation-in-Aid (AIA) is projected to increase to Sh2 trillion (16.4 per cent of GDP) up from the estimated Sh1.8 trillion (16.6 per cent of GDP) in the FY 2020/21.

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