Ruto defends his record, but Kenyans still feel pain of high living costs

Quinter Moraa a fruits trader in Keroka town displays her fruits at Keroka town. (Sammy Omingo, Standard) President William Ruto yesterday put on a brave face as he painted a lofty picture of the state of Kenya's economy three years after he took office, amid the persisting high cost of living and unemployment. In his State of the Nation Address to a joint session of Parliament, Ruto said he has transformed his 2022 vision into reality, telling MPs and Kenyans he now has a story to tell. According to the President, his major successes include growth in the industrial and agricultural sectors, low inflation, a strong Kenya Shilling as well as affordable housing-all of which he said have created job opportunities for thousands of youths. "Today, the evidence is clear, evidence of promises made and promises kept. In just three years, we have built not monuments of words, but foundations of progress. And yet, even with these achievements, I am convinced that this is only the beginning," he said. He insisted the high cost of living has come down after the government reduced cost of food. "Kenyans in 2022 marched with empty sufurias, a stark symbol of frustration and the unbearable costs of basic commodities. "From the very outset, we made an intentional and strategic decision to subsidise production and not consumption. We understood that lasting relief would not come from temporary subsidies and price controls, but from strengthening the foundations of agricultural production," Ruto said. He dismissed his opponents criticising his performance, terming them "the high priests of eternal pessimism", who criticise without responsibility and tear down without offering alternatives and want people to believe that the country's economy is going in the wrong direction. "But while anyone may speak their mind, and that is the beauty of our democracy, no one is entitled to manufacture self-serving falsehoods and traffic them as facts. And facts are exactly what I present today; clear, verifiable and indisputable," he said. The President's chest-thumping, however, seemed to ignore the constant cry of the majority about the high cost of living and tough operating environment for businesses, caused in large part by increased taxes and deductions on workers' payslips. In the three years of his administration, workers' salaries have dwindled as housing levy was forced through, where employers and employees pay 1.5 per cent of the wage. Other statutory deductions such as for National Social Security Fund and Social Health Authority have progressively increased, cutting into the take-home pay. Ruto, however, admitted that while Kenya has made commendable progress since independence 62 year ago, it still punches way below its true weight despite the talent, resources and the spirit not just to improve, but to leap and to make the transition from a developing country to a developed one within the current generation's lifetime. On the cost of living crisis, he noted that inflation, which stood at 9.6 per cent in 2022, has steadily declined to 4.6 per cent as of last month, bringing much-needed relief to households while the shilling has stabilised at Sh129 to the dollar for nearly two years, a direct consequence of his government "prudent monetary policy and disciplined fiscal management." "Our successful Eurobond redemption signalled to the world that Kenya honours its obligations," Ruto said. On inflation-even though the rate has held steady within the government's target range of 2.5-7.5 per cent-an analysis of KNBS data shows that over the past 12 months, the prices of numerous daily essentials have surged. Staple items saw dramatic jumps with the price of sugar going up by 22.6 per cent while the cost of sifted maize flour and fortified maize flour rose by 16.4 per cent and 16.5 per cent respectively. Ruto added that three years ago, Kenya ranked as the 8th-largest economy in Africa, with a GDP of $115 billion but today, its GDP has increased to $136 billion, moving the country up to become the 6th largest economy on the continent, according to the International Monetary Fund. "This steep rise is no accident. It is the product of deliberate choices, disciplined execution and strategic reforms that have strengthened our economy and unlocked its potential," he said. But as analysts have pointed out, GDP numbers do not tell the whole story. "The truth of this matter is we don't 'eat GDP', we want better lives, living and livelihoods," said economist and The Standard columnist Dennis Kabaara. "Put simply, GDP is at best a measure of activity stretched to output, not outcome as wellbeing. "Our very recent GDP numbers are mostly physical capital, with some human capital and next to nothing productivity gain. This keeps us at the bottom of the global middle income band. We have spent the last decade building things, not people," he said.

Ruto defends his record, but Kenyans still feel pain of high living costs

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