State, private sector on economic revival drive
The government and private sector yesterday met to discuss how to unlock liquidity pressure frustrating economic growth.
Stakeholders, who met to look into ways of enhancing performance of the private sector by addressing challenges affecting them, laid out plans in a closed-door meeting at the Kenya School of Government in Nairobi.
Speaking after the forum, Kenya Private Sector Association (Kepsa) chief Executive Carol Kariuki, said the economy could only be stimulated by reducing imports and widening the export base.
The captains of industry discussed how to quickly spur local consumption while creating a good environment for business. The discussions covered areas that could quickly stimulate growth, particularly those under the Big Four agenda.
Kariuki said the meeting had agreed to come up with a list of locally-produced products that could be bought by the government, a move informed by the fact that government is the largest spender, given its Sh3 trillion Budget.
In the 2019/20 Budget, the government set aside around Sh380 billion in development expenditure to facilitate the Big Four agenda.
Interior Cabinet secretary Fred Matiang’i, who heads the Cabinet Committee on the Implementation of National Government Projects, said President Uhuru Kenyatta had ordered all pending bills be paid by the end October this year.
He said they would draw up an action plan which will bind the two parties and which will be presented to the President “in the next two weeks.”
“The business of the government is to support the private sector, to ensure growth of business and creation of employment,” said Matiang’i.
President Uhuru had issued two policy directives to remove bottlenecks that have caused a reduction in overall spending and business activity in the economy due to delays in payment by the government.
Accounting officers were ordered to settle all pending payments without audit queries accrued on or as at June 30.
He further directed the Treasury to secure full compliance of the directive on clearing of pending payments and called upon county governments to follow suit.
Most contractors supplying county governments say they have not been paid, with Parliamentary Budgetary and Appropriations Committee chairman Kimani Ichungw’a saying by close of the 2018/2019 financial year there were pending bills amounting to more than Sh108 billion.
Ichung’wa had warned that failure to release the money as directed by President Uhuru Kenyatta recently had negatively impacted on businesses across the board.
Other areas discussed included reviving the film industry, and broadening of the tourism products to include much more than safari, beach and sports.
“We acknowledge that there have been challenges. We are continuously engaging with the private sector to find solutions that can work best for the country. The government regards the private sector as an important driver of the economy,” said head of public service Joseph Kinyua.