Kenya’s 2019/20 budget will be the seventh under the country’s jubilee administration. Its National government plans to spend Sh 3.02 trillion, about 10 billion higher than the current (2018/19) budget.
There is an estimated deficit of Sh 607.8 billion, an increase from Sh 562 billion this financial year. The government is likely to borrow more in the next fiscal year to bridge the deficit as Kenya Revenue Authority (KRA) is expected to miss this year’s revenue collection target by Sh 118 billion.
Treasury Cabinet Secretary, Henry Rotich, has set a revenue target of Sh 2.2 trillion while KRA is expected to collect approximately Sh 1.9 trillion. Experts say the government might also heighten the tax regime to fill this budget deficit.
In the 2018/2019 financial year, the government was forced to introduce stringent tax measures to raise funds to support the budget.
This year, the government will likely raise Value Added Tax (VAT) from the current 16 per cent and Capital Gains Tax, which targets the wealthy. The betting industry will also be targeted.
Raising the VAT will contribute to a high cost of living as prices of basic goods such as food will go up. According to the Central Bank of Kenya (CBK), Kenya’s public debt stands at Sh 5.4 trillion.
In the financial year beginning July 1, 2019 Kenya will spend Sh 800 billion to repay maturing loans mostly owed to foreign lenders.
The budget as a share of Kenya’s Gross Domestic Product (GDP) is expected to decline to 28.1 per cent, from 32.4 per cent in 2018/19 financial year, a 4.2 per cent drop.
According to the Budget and Appropriation Committee, Sh 2.45 trillion will be allocated to the three arms of government, a slight increase from Sh 2.23 trillion in 2018/19 financial year.
The country’s judiciary remains the least funded of the three arms of government having been allocated Sh 18.88 billion. The Executive and Parliament have been allotted Sh 1.84 trillion and Sh 43.78 respectively.
In the past financial years, the Education sector has always received the lion’s share of the budget, likewise Sh 473.3 billion has been allocated to the sector; followed by Energy, Infrastructure and ICT which have been allocated a combined budget of Sh 406.7 billion.
Rotich’s budget today will crown the total Jubilee administrations ambitious spending to Sh 13 trillion over eight years against total tax collections of less than Sh 8 trillion over the same period.
Masiyiwa to Bid for Ethiopian Telecoms License
Zimbabwean Billionaire and founder of Econet Global Ltd, Strive Masiyiwa has disclosed his position on acquiring a telecommunications license in Ethiopia, which is opening up the industry to foreign investment for the first time.
The Horn of African country has announced plans to sell as much as 49% of the state-owned monopoly, Ethiopian Telecommunications Corp and to issue two new spectrum licenses.
Carriers including Orange SA, MTN Group Ltd. and Vodacom Group Ltd. have already shown interest in the country of more than 100 million people, which has a relatively low level of data penetration and internet access.
Econet, through a number of its subsidiaries, is actively developing interests in Ethiopia.
Econet has operations in Zimbabwe, Lesotho and Burundi, with investments in Europe and South America.
The government of Prime Minister Abiy Ahmed had scheduled the liberalization of the industry for early this year.
However, it is yet to provide guidance on the exercise, including any limits on foreign ownership.
Nigeria posts highest quarterly GDP growth since recession
Nigeria’s economic growth rose to an annual rate of 2.55% in the three months to the end of December, its highest quarterly growth since a 2016 recession.
Africa’s largest economy grew 2.27% in 2019 from 1.91% the previous year. The country has struggled to shake off the effects of a 2016 recession that ended the following year and has been grappling with low growth since.
Crude production hovered at around 2 million barrels per day throughout the year.
The non-oil sector, which the government aims to make the main growth sector, rose 2.26% in Q4.
President Muhammadu Buhari has pledged to revive the economy and diversify it away from oil over-dependence but investors have been waiting for policy signals that could lift growth.
Recently, the IMF cut its 2020 growth forecast for the country to 2% from 2.5%, citing lower demand for oil due to fears that the coronavirus outbreak in China will cause a slowdown.
Annual inflation in Nigeria rose for the fifth straight month to 12.13% in January, its highest in nearly two years.
Absa Kenya signs almost 5 million customers on virtual platform
Kenya’s Absa Bank , a part of South Africa’s Absa Group, has signed almost 5 million customers on its virtual banking platform, which it sees as a major driver for future growth, chief executive, Jeremy Awori announced yesterday.
When the bank first launched its virtual savings and loan app known as “Timiza” — Kiswahili for “Achieve” — in March 2018, it attracted 300,000 customers. By the end of the year it had 3 million users, with lending standing at 10 billion Kenyan shillings ($98.91 million).
The bank, formerly known as Barclays Kenya, also has a separate mobile-based banking service to process normal customer transactions such as deposits and withdrawals.
Absa Kenya, posted a pretax profit of 8.18 billion shillings in the first nine months of 2019, compared with 7.72 billion shillings in year-earlier period.
Kenyan lenders have in recent years , turned to technology as they try to counter competition from mobile phone-based financial services such as from telecoms operator Safaricom’s M-Pesa platform, which had 23.6 million users as of last September.
Absa’s virtual banking app’s competitors include those run by KCB Group’s, NCBA Group and Equity Group.
Pressure to use mobile banking services increased further when the government imposed a cap on commercial lending rates in 2016 that ate into bank profit margins forcing banks to search for new ways to grow their businesses. The cap was scrapped at the end of last year.
Inside Africa’s largest media conference
Mubarak given state funeral, Egypt declares 3-day national mourning
South Africa scales back public spending in budget presentation to parliament
Ethiopia frees 63 critics, opposition prisoners jailed over alleged coup
Masiyiwa to Bid for Ethiopian Telecoms License
Is the Lagos State Government detached from reality?
Nigerian Actor, Juwon Awe Is Dead
Nigerian startup orders fifty A220 planes from Airbus, dumps Boeing 737 Max
Nigerian English is a thing and the world is noticing
Misery on repeat
Will Uber and others replace Lagos’ yellow cabs?
Vimbai Chats with Mmamoloko Kubayi-Ngubane on SA Tourism
Abi Owolawi Chats with Vumile Msweli on Human Resources
#NCExclusive with Rotimi Akinoso of “Power”
2019 Southern Sun Ikoyi Golf Tournament Press Briefing
Politics1 week ago
Foremost Nigerian broadcast equipment supplier, Lucky Omoluwa is dead
Business News1 week ago
Uber to face commission capping regulations in Kenya
News1 week ago
Gunmen in military uniforms kill 22 in Cameroon, separatists blame army
North Africa1 week ago
Tunisian PM submits list of cabinet nominees, awaits parliamentary approval
Business News1 week ago
Maroc Telecom reports $620 million profit
Entertainment1 week ago
MTN Nigeria announces Y’ello Star music talent show
North Africa Politics1 week ago
Sudan peace talks with rebels extended by 21 days
Politics5 days ago
‘Nigeria too important to be on US travel ban’, seeks removal -Interior minister