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Mohamed Wehliye Profile picture
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4 Dec, 5 tweets, 1 min read
1. You are supposed to run smaller deficits in times of growth & run big ones to support the econ during recessionary periods. Jubilee doing the opposite. Taxes might not yield much more revenue but could actually see acceleration of businesses closing down - counterproductive
2. Whereas the govt needs money, from macroeconomic perspective, it doesn't make sense to hike taxes when the economy is flirting with recession. You just might tip it over. We are still in the middle of the pandemic and most governments have extended the Covid support measures
3. For corporates, lower tax measure accorded them some extra headroom which probably went to keep a few more workers employed. For households anyone with a pay cheque has been helping GoK to support others.The extra 5% was like a direct stimuluswith - a huge multiplier effect
.......even if given to a very small subset of the population. African culture stimulus system! I use myself as a barometer of econ hardship back home. The rate of Mpesa load this year has been crazy. Now imagine those like me back home reliant on pay cheques & supporting others?
In my view, the decision to reverse the Covid 19 measures will not yield much for GoK but will cause a huge problem for citizens & for the economy. And as a person who has designed these programs & has just extended one to March end 2021, I have the analysis to back this line!

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Mohamed Wehliye Profile picture
4 Dec
1. Some of the BBI amendments cannot even be practically implemented. Let's look at the amendment to article 203 that caps the revenue the county with the highest per capita allocation will get, to 3 times the lowest.
2. Let's use the current allocations of Ksh 316 transferred to counties in 19/21 FY. Tana River & Lamu get the highest per capita allocation of Ksh 18,533 & 18,033 respectively. Nairobi county gets the lowest at Ksh 3,621. Meaning no county should get more than Ksh 10,863.
3. 9 counties in total will be above this threshold and the cap means they would have to surrender Ksh 9.687b. This is where the problems start. First, there is no suggested method to share what will effectively be taken away from these 9 counties.
Read 12 tweets
Mohamed Wehliye Profile picture
28 Nov
1. Dear H.E President Uhuru Muigai Kenyatta @StateHouseKenya. In 2022 (in sha Allah), there will be an election & there will be losers & winners, court petitions, riots, teargas not withstanding the fact that BBI will be in place. It is happening even in the USA these days.
2. BB1 will not change that. What BBI will definitely do is to add to our already heavy economic burden. We are already in a difficult situation & it is time to downsize & consolidate. Not a time to create PM office,2 deputies (remember these are not individuals but institutions)
3. It is not also the time to create a 630 bunge & hard code the transfer of 600b we don't have to the counties in the constitution. I am for devolution & I have seen the good stuff it does but the reality is we don't have the money for a bigger government - at both levels
Read 7 tweets
Mohamed Wehliye Profile picture
22 Nov
1/ 5. The promise to give counties 600B (35%) is just a pie in the sky promise that will break the country or cause a constitutional crisis in the future. As we speak, we can't afford to pay for both O&M & counties and something may have to give way very soon.
2/5. We can only afford to pay for salaries + dent & O&M or counties. That is why counties have not been paid for the last 3 months & s@$t is about to hit the fan. Those saying this will be possible because more functions will be devolved to the counties are also being dishonest
3/5. First, assuming even there is something (possible) left to be devolved, you will just be transferring the current funding problems to counties. May be that is the objective? counties are not looking for more work, they are looking for more money to do what they currently do!
Read 6 tweets
Mohamed Wehliye Profile picture
3 Sep
1. In almost every economy, the government is one of the biggest customers of the private sector for supply of goods & services. The private sector reinvests the money & this helps grow the private sector & the economy & also create sustainable employment for the citizens.
2. Since 2013, trillions of shs in development budget & recurrent expenditure has gone into briefcase cos - to well connected folks with no real businesses & who don't employ even their spousese. Their inflated profits are used to buy Mercs, real estate & expensive overseas hols
3. Add that to the fact that almost all the monies we borrowed over the last 7 years did not even come into the economy. We borrow from a Chinese bank & give the contract to a Chinese company. The money moves from one account in China to another in China.
Read 7 tweets
Mohamed Wehliye Profile picture
6 May
Covid-19

Along with dealing the health issues, the highest urgency lies in securing the funding to businesses. The government, the central bank & the commercial banks should come together and play a key role in mitigating the long term economic damage of this health crisis!
1. Covid-19 is a health crisis that has also serious economic consequences. Many countries are dealing with the health problems but are at the same time trying to minimize the impact on the economy now & once the health issues are dealt with.
2. In the last 2 months or so, I have been involved in designing Fiscal impulse, Deferral & Liquidity/Gurantee programs meant to respond to the Covid-19 crisis. In the process, I have looked at the various programs adopted by different countries (of different sizes & capacity)
Read 14 tweets
Mohamed Wehliye Profile picture
2 Jan
1. We face serious economic issues in 2020. It is no rocket science. All the numbers point to an unfolding debt nightmare. We need more strategic approach to macro-economic policy instead of piecemeal knee-jerk tactical interventions if we are to save the country.
2. Unless we put breaks to spening & turn the economy around quickly, there will be a downward spiral feeding on itself — an internal fiscal & financial sector crisis. Slower growth would also deepen an already worsening fiscal crisis.
3. Piecemeal reform is like a game of snakes and ladders — you go up one small ladder, and get bitten by a snake tumbling back to where you were. We need comprehensive bold reforms to catch the big ladder and on to the golden turnpike.
Read 8 tweets

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