Economy: Uhuru lauds fight against Covid-19
President Uhuru Kenyatta has lauded the country’s coronavirus (Covid-19) response, saying it contributed immensely in bolstering economic growth.
Following the outbreak of the pandemic, the Head of State recalled that after much reflection, his administration opted for the public health argument over the economic argument.
“Our rationale was that we can always revive an ailing economy, but we cannot bring to life those who die from Covid-19,” he said when making his eighth and the last State of the Nation address at the Parliament buildings on Tuesday.
The President said the decision was arrived at plausibly from recommendations by medical scientists as his administration sets out “to build the irreducible minimums recommended by the experts to forestall a Covid-19 crisis.”
He, however, added that although the health argument won, the government did not dismiss the economic argument in total. “We made fiscal choices to cushion the economy through a number of economic stimuli. And today I am happy to go on record in this August House as having succeeded in the choices my administration made.
Because of our fiscal stimuli, today I can report that the impact of Covid-19 on our economy was 14 times less than that on the global economy,” he said.
Impressive GDP growth
Those choices, such as last year’s reduction of Value Added Tax (VAT) for the business community from 16 per cent to 14 per cent in 2020 before the January review, contributed largely to the country’s gross domestic product (GDP) growth seen this year, according to Uhuru.
Kenya’s economy is expected to grow by 6.4 per cent in 2021 and 6.0 per cent next year, Central bank of Kenya estimates show. Indeed, statistics show that in the second quarter of 2021, Kenya’s real GDP grew by 10.1 per cent, the first such growth in the country’s economic history registering an impressive GDP growth of Sh11 trillion today from Sh4.74 trillion eight years ago.
That figure suggests that Kenya has gained more wealth than any other country in Africa, for a country that in 2013 ranked 12th wealthiest in Africa’s.
“This GDP was accumulated in a span of 123 years through the four administrations before ours. My Administration has multiplied this GDP by a factor of two. We have moved six ranks to become the 6th wealthiest nation on the continent, on account of the choices we have made,” he noted.
Last month the President announced a new set of stimulus measures which said would help fast-track the country’s economic recovery with an injection of additional Sh25 billion into the economy whose growth was slowed by the pandemic.
In his Mashujaa Day speech, Kenyatta announced a slew of relief measures for several sectors with a special focus on health infrastructure which he suggested would help achieve the 6 per cent growth target set by the National Treasury and global lender, International Monetary Fund.
The 13 measures announced in October covering agriculture, health, education, drought response, policy, infrastructure, financial inclusion, energy, environmental conservation are also expected to complement the ongoing State interventions meant to sustain the momentum of recovery.
President Kenyatta said the government had saved Kenyans Sh55 billion in hospital bills in just one year.
He noted that in the financial year 2019/21, NHIF managed to pay for 4.44 million hospital visits; covering 1.43 million cases of inpatient services and 3.01 million cases of outpatient services.
“This in turn saved Kenyan households, approximately Sh54.9 billion in financial losses brought about by health-related issues,” the President said.