Public Debt and Wealth Development.

 



My sincere worries stem from the worrying trends in rising debt and key economic indicators crucial for our country's economic development. The Debt/Revenue ratio, currently at 64.3%, surpasses the IMF threshold of 30.0% by over 30%, signalling a potential doom on our fiscal capacity. Additionally, the Debt/GDP ratio has climbed to 70.2%, exceeding the IMF threshold of 50.0% for developing countries by more than 20%. National Treasury debt ceiling was also recently amended in the Public Finance Act, 2012, from a fixed shilling mark to any figure not surpassing 55% of the country’s GDP, but as usual it is difficult to argue that this amendment won't be altered in the near future  as fiscal deficit continues to soar in every cycle of financial year. These statistics paint a concerning picture, pointing towards an unsustainable trajectory that demands our immediate attention. Further complicating matters are the prevailing economic headwinds, including the ongoing conflicts in the Eastern Europe; Ukraine-Russia war and gulf tensions between Gaza strip and Israel which has magnified into naval tensions  in the strategic Red Sea tension between US and anti-Israel Houthi forces, these conflicts have born serious global supply chain problems, causing high inflation in most developing countries, Kenya included, the impact of continuous US monetary tightening policies, fluctuating exchange rates of the Kenyan Shilling, and a persistent jumps of inflation rate of 6.31%. Adding to the complexity is the imminent maturity of a 10-year Eurobond in June, which the government have prepared to settle by recently acquiring $1.5B. These factors collectively exert immense pressure on the Kenyan economy, posing a substantial threat to the realization of our long-term strategic economic goals: Vision 2030, Sustainable Development Goals, and regional AU Agenda 2063 plan and global development targets largely envisaged in UN sustainable development goals.


The bottom-line is Kenya is in polycrisis and Public Debt is the dominant player in denying the country a steady development of wealth! Motivated by these public debt concerns, I have delved deeply into the intricacies of public debt and come to the belief that it stands as the primary roadblock to the development of national wealth in Kenya. However, acknowledging that not everyone shares this opinion, as some argues, there are certainly many countries in the western hemisphere which have huge bucket of debt but still have managed to create wealth for their citizens, for example US which has 102% Debt/GDP ratio as per the projections of 2024, this is more 30% of Kenya’s Debt/GDP ratio or even Japan which have a Debt/GDP ratio of 268.0% as the projection by the end of 2024. I have organized this webinar as a platform for an open and insightful conversation.

Come lets discuss if my assessment is  true or not, I want to listen to your opinion. I believe in power of conversation. 

Here is meeting  info: Public Debt and Wealth Development 

Saturday, March 16 · 7:30 – 9:30pm

Time zone: Africa/Nairobi

Google Meet joining info

Video call link:

https://meet.google.com/veh-ebhd-ajr


Comments

Post a Comment

Popular posts from this blog

Donald Trump is back, what in it for Kenya?

Image
Donald Trump won the just ended 2024 elections being the 45 th and 47 th POTUS, perhaps the most consequential election in the recent history making the greatest political comeback to the Whitehouse and marking presidential history as the first president to serve non-consecutive terms since 1897 and being the second one after Grover Cleveland being the 22 nd and 24 th president of the United States. In simple terms he made a remarkable history! However, his pronounced radical conservativism in matters culture and strong protectionism in matters economy and foreign policy has undoubtedly left global leaders anxious of what is to be unpredictable nature of leadership for the next four years.   America is the greatest power both in economic, military and cultural diversity therefore what transpires there is unignorably important. And that is perhaps the reason why global political leaders, business honchos and investors are always being on the alert of US affairs. Kenya-US relat...
Read more

Is religion dying in the face of Gen Z?

Image
                                                “There will be no Church   in the next 200 years, am not saying ‘No Faith & God’, but ‘No Church’, get me clear!” I once heard these words in a certain podcast, didn’t take them seriously but now there is a coming belief that person who said them was not actually crazy as I had thought in that moment. I n the   present fast-shifting worldscape , the ascendancy of organized religions is undergoing through   intense alteration than ever before in the history of religious transformation . Once foundations of soc iocultural power, organized religions such as Christianity are immensely facing unprecedented drawbacks , especially in regards to the youth population. This trend is not exclusive to Christianity but it extends to other stronger faiths such as Islam , Hinduism , Buddhism. However, this dec...
Read more

GAGHAGUA'S IMPEACHMENT A Game-Plan for 2027 elections.

Image
  An Autumn of Impeachment, A Disgraced Kenya’s DP! If there is something that Kenya’s political atmosphere is not new to is unending innuendos, tumult, betrayal, unexpected rapprochements, blackmail and split of regimes before their tenures lapse. Kenya is yet on another political pandemonium just months after historic Gen Zs June ‘#Occupy’ protests. Protests that nearly ousted the current regime out of state power.   A pandemonium partly caused by lingering effects of successful #OccupyParliament protests inter alia. With successful tabling of Deputy President Impeachment motion on the floor after garnering a staggering endorsement of 291 members of national assembly, Kenya's political space, particularly government has been greatly divided in ways never experienced before. While impeachment of a key figure in presidency is granted in the article 145 and article 150 of constitution of Kenya 2010, no member of parliament has in the past successfully tabled a motion to imp...
Read more

WHAT YOU NEED ABOUT KENYA'S PUBLIC DEBT CRISIS

Image
 National Treasury building In  my inaugural article on this blog on  the fall of  third quar ter of previous financial year, I stated my worries o n the public debt crisis which is seriously plaguing our country, don’t’ worry, my worries still persist.  That persisting nature of the crisis has continued to spark a raging public discourse on how regimes in the past and in the now have failed in  prudent debt management to such an extent it exist as hindrance to, instead of being an  enabler of country’s   development.   In fact, the mystery of public debt is one of  the major issues that enraged the public during the June 2024 #Occupy protests. In agreement, experts, banking sector, debt management practioners and the public endorse the belief that public debt is not actually undesirable to any extent however what really matter is how it is being exploited for the interest of public good. Most first world countries whose economies have p...
Read more

SHI-SHA-SHIA-SHIFA-SHIF: A New Age of Social Healthcare!

Image
    The pace towards Universal Health coverage is fastening as the current regime is intending to deliver its share of mandate by building from the MTPIII/Big Four Agenda’s healthcare achievements. While KK regime is steadfast in effecting healthcare changes, the government is yet to dissipate the abounding circulating confusions, confusion founded on numerous questions on the ongoing rapid transition of healthcare financing system from the previous National Health Insurance Fund Act, 1998 to the new Social Health Insurance Act, 2023. Questions such as why the impetuous operationalization of the Social Health Authority. In fact, it is hardly comprehensible that the institution has not been fully established to undertake its mandate as per the SHI Act. Concerns such as why can’t the health authorities attain the same outcomes aimed to be achieved by the new frameworks with the National Health Insurance Fund? Questions such as how what exactly does means testing instrument, ...
Read more

The UNTAPPED KENYA'S COFFEE INDUSTRY

Image
  Despite Coffee being the third most exported product in Kenya, revenue gains from the industry are still   unimaginably modest, but why?  Agricultural sector still prevail as the backbone of Kenya’s economy. According to US Aid report 2023, agricultural sector accounts for 33% of Kenya's GDP. In the sector, coffee is one of the main agricultural products exported to foreign markets driving agricultural sector and Kenyan economy at large. In fact, it is the third most exported product by Kenya. Out of 28million Ha Kenya’s agricultural land, coffee farming takes approximately 119,000 Ha which is 0.5% coverage  of agricultural land.   More than six million Kenyans are employed by coffee industry either directly or indirectly. While the industry is significantly important in economic growth of the country, coffee farming have recorded drastic decline since 1990s. Statistically, coffee farming has declined by over 30% in terms of land coverage from 170,000 i...
Read more

War in GAZA: A War on a Holy Land.

Image
  War is Blood War is Death War is Evil! The world has never been completely devoid of wars, has it? Since ancient times, adversary states had always involved themselves in wars either directly or indirectly to secure various interests such as expanding kingdoms, imposing religion, spreading   cultures, advancing economic interest inter alia. During the ancient eras, kingdoms never ceased to aspire to expand their territories by conquering others. Remember the biblical story  of King Nebuchadnezzar II conquering  Jerusalem, Nazi’s Third Reich invasion of European powers, followed by occupation of Palestine by Zionists and colonization of third world countries and most modern one annexation of Crimea by Kremlin among many others that you might know? Presently, the world is bruising from several real wars and conflicts from Africa, to Middle East and Europe. This article will put special focus on the current war in Gaza, a long-standing conflict between Israel and Pa...
Read more

Is the current Economic reprieve sustainable to the Long-term?

Image
  If there is something that economics replicate is life. In life there are moment of agony and there are good times there are moments of tumult and moments of peace. Likewise in economics there are chapters of economic turbulence and bout of stability, stretch of depression and duration boom, there are tempos of growth and spell of stagnation. There are period of inflation and period of deflation. Let’s get to it now. Now, if you have walked into Kenyan supermarkets in recent days to do your routine shopping, be it groceries grains, maize flour, cakes,milk, soda or any other food, you must have noticed that food prices have dramatically plummeted for the last three weeks. While the globe is currently experiencing times of geopolitical turmoil as are conflicts are soaring in the Middle East and Eastern Europe, two regions which are fundamentally important to globe because what they provide to the other countries are vital for their survival,fall in food prices is something uneasy...
Read more

What next with Gen Z movement, is it Dead or Not...?

Image
                                 Surrendered but still on course, In recent times, the country has faced a renaissance of socio-political activism, especially among its youthful population. What happened in June 25 2024, marked a bold moment in the history of demonstrations in the quest for public accountability showcasing the power and determination of Generation Z to call for change. Gen Z, a generation of people born from 1997-2004. And of course it was not the nation’s first time experience a youthful population rising to defy the status quo as it present a historical continuity of a youthful involvement in the country’s political issues. Not a first-time experience, read some history! Remember Kenya African Union, Mau Mau, the Kepenguria Six and other grass root freedom fighting organizations during the colonial era? These local organizations played a crucial roles in the struggle for Kenya’s...
Read more

8 Key Outcomes from Baku’s UN COP 29, 2024

Image
                                              Credit: UN Climate Change/Kiara Worth  The fight against climate change is fiercely on and BAKU was just another  reminder that time is running out! A two-week UN Climate summit (COP 29) just concluded in BAKU after world leaders, investors and all sector- stakeholders meet to forge a collective action and to underscore the urgency   to scale up efforts against climate crisis. It was small time of broad negotiations to set agreements that could strengthen efforts while building on the achievements of the past climate commitments.   Climate change is no longer a conspiracy theory, it is an evident existential threat to the planet. The changing weather patterns unfamiliar to farmers in my home village causing food shortage, deadly regular hurricanes in the US, to unbearable heatwaves in Europe, disastrous bus...
Read more