Kenya launches record budget to sustain economic growth

  • World
  • Friday, 14 Jun 2024

NAIROBI, June 13 (Xinhua) -- Kenya on Thursday presented its 3.9 trillion shillings (about 30 billion U.S. dollars) budget for the financial year 2024/2025, focusing on sustaining economic growth.

Njuguna Ndung'u, the cabinet secretary for the Ministry of National Treasury and Economic Planning, who presented the budget statement before the National Assembly in Nairobi, the capital of Kenya, said the government seeks to foster economic growth after it rebounded in 2023.

"The Kenyan economy is now unwinding from layers of negative and persistent shocks, some of which have structural effects on economic activities," Ndung'u said.

He observed that economic recovery is evident, with the gross domestic product growth standing at 5.6 percent in 2023, up from 4.9 percent in 2022.

The expansion was largely supported by growth in agricultural activities, given the improved weather conditions and subsidized inputs for farmers.

"Looking ahead and considering the ongoing reforms, we project our economy to grow at 5.5 percent in 2024/2025. This strong growth will be supported by ongoing interventions," he said.

Ndung'u said that the government targets to collect 25.6 billion dollars during the fiscal year, which comprises 22.5 billion dollars from ordinary revenue and the rest from appropriation in aid and grants.

The country will, therefore, be left with a fiscal deficit of 4.63 billion dollars, which would be raised through borrowing, 2.62 billion dollars externally and the rest domestically.

To attain food and nutrition security, Ndung'u in his budget, the second in President William Ruto's administration, proposed an allocation of 423 million dollars, for various programs under the agriculture sector.

To enhance education standards in the country, he allocated 5.1 billion dollars, or 27.5 percent of the budget to the sector, funds that will cater for school feeding programs, technical education as well as free primary and secondary education and recruitment of teachers.

He said the government is keen on promoting access to quality and affordable healthcare through the Universal Health Coverage Program. "Toward this end, I have proposed an allocation of 984 million dollars to the health sector to support various activities and programs," he said.

To raise investments in Kenya's ICT sector and the creative economy, he allocated 126 million dollars to fund various initiatives, including the development of a digital superhighway.

Ndung'u allocated 1.49 billion dollars for infrastructure development, including expansion and maintenance of roads, railways, sea, and airports to achieve socioeconomic transformation, enhance Kenya's competitiveness and facilitate cross-border trade and regional integration.

He also allocated 540 million dollars to scale up the production of a reliable and affordable energy sector.

"And to enhance national security, I have proposed an allocation of 2.93 billion dollars to support operations of the National Police Service, Defense, the National Intelligence Service and Prison Services," he said.

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