But, Kenya’s economic managers are not entirely blameless. The country’s appetite for external debt is worrying.
Kenya’s public debt has crossed the Sh5 trillion mark early this year but Treasury mandarins have still lined up mega projects.
National and county governments have failed to live within their means. Profligate spending is made worse by corruption
That Kenya needs external funding to finance its huge infrastructure deficit is not in question. Nearly every country, even in the Developed World, borrow at one point to finance development.
Kenya also no doubt needs the backing of the International Monetary Fund to be in the good books of international lenders, most of who rely on IMF’s assessment before committing their money in it.
What is, however, debatable right now is whether Kenya has to expose its citizens to disproportionately high levels of daily economic pain to be in IMF’s good books.
Of immediate concern is whether Kenya will meet conditions set to access a Sh150 billion standby loan intended to cushion the shilling against external economic shocks.
That is why the Central Bank of Kenya and President Uhuru Kenyatta’s economic adviser Mbui Wagacha could be justified in asking the Treasury to reject the IMF conditions.
In a country grappling with high unemployment rate and declining household incomes, Kenyans are bound to resist policies that imply additional economic burden for the poor.
Yet because Kenya must submit to the whims of some Washington-based experts, indirect taxes have been adjusted upwards nearly every other financial year. The IMF wants the consumer to pay taxes on basic food items like kerosene, airtime and money transfer.
What’s more, the IMF wants the Treasury to repeal interest capping law despite its role in pulling down the cost of credit in the past two years. In a post-UN world, the shortest route to subjugation has been through the pile of debt foreign governments and their appendages dish out with abandon.
But, Kenya’s economic managers are not entirely blameless. The country’s appetite for external debt is worrying.
Kenya’s public debt has crossed the Sh5 trillion mark early this year but Treasury mandarins have still lined up mega projects.
National and county governments have failed to live within their means. Profligate spending is made worse by corruption.
Kenya ought to reject IMF’s economic pain while cutting its coat according to its cloth.
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Note: The results are not exact but very close to the actual.
