Thread by @IEAKwame

Budget Theme : "Bottom Up Economic Transformation and Climate Change...... " Truly a mouthful 1/N #IEAKEBudget2023

5 Priority sectors #IEAKEBudget2023
1. Agricultural transformation
2. Transforming the MSE
3. Housing and Settlement
4. Healthcare
5. Digital Supehighway
2/N

BETA to be managed through a value chain approach. #IEAKEBudget2023 3/N

Economy expected to rebound to 5.5% growth in GDP from 4.8% in 2022 and will maintain pace for medium term . #IEAKEBudget2023 4/N

Economic activity expected to improve and drive aggregate demand (Keynesian Vocabulary) . #IEAKEBudget2023 5/N

CBK tightened monetary policy in the last year and this action together with improved agriculture performance and support through fertilizer subsidies ...led to easing inflation pressures. #IEAKEBudget2023 6/N

Inflation expected toretun to target range by second quarter of the Financial Year. Talsk sof a new white paper on moderniaing monetary policy operations #IEAKEBudget2023 7/N

Fiscal policy stance expected to help reduce the growth of debt through fiscal consoliddation. #IEAKEBudget2023 8/N

BETA premised to address the challenges being experiencesd and build on the success realized over time. 5 priority sectors envisaged to have greatets impact on households. #IEAKEBudget2023 9/N

5 pillars are divvided into two with enablers (that Vision 2030 vocabulary again). #IEAKEBudget2023 10/N

Food security and climate change will also become priority areas going forward. #IEAKEBudget2023 11/N

GOK unders support with devt partners working out a growth friendly fiscal consolidation plan.. without compromising service delivery to citizens ...#IEAKEBudget2023 12/N

To reduce defeicit from 5.5% of GDP to 4.5 in 2024 FY and to 3.5% by FY 2026. (Big claims) #IEAKEBudget2023 13/N

Acknowledged the IMF and WB for helping Kenya walk the journey of socio-economic development. 5th review of IMF programme concluded in 2023. #IEAKEBudget2023 14/N

Once IMF board approves agreed plan, Kenya will receive about $600 M in support under agreement. IOW: This extnsion saved our skins. #IEAKEBudget2023 15/N

New Government to Government arrangement through Legal Notice that allows provate sector to import through the OTS. The monthly import is 740000 MT of which 90% is for domestic use. #IEAKEBudget2023 16/N

To contain forex volaitility on a monthly basis, this arrangement is intended to ease demand of US$ that is driven by petroleum iports and to extend time for sources US$ from 5 days to 180 days. #IEAKEBudget2023 17/N

This arrangement allows us to prevent pressure for US$ domestically and prevent speculation. #IEAKEBudget2023 18/N

Climate Change: Kenya economy is vulnerable to ravaging impacts. worst drought in 40 years theratened livelihoods. There's need to build a climate resilient economy. #IEAKEBudget2023 19/N

A series of policies aimed at attaining carbon neutrality by 2050 by reducing GHG emissions, land degradation and biodiversity loss. Mitigation minatreamed in all programmes by GoK. #IEAKEBudget2023 20/N

national tree planting to be eld by presideint aims to improve tree cover from 4% (?) to 12% by planting at least 15 billion treess (who sees tenders here?). #IEAKEBudget2023 21/N

To present regulations to allow for establishment of Disaster Risk management Fund. (Kweli, KK will not tire in creating funds. Further eroding budget flexibility). #IEAKEBudget2023 22/N

Reports that process for full rollout of system for integrating GoK procurement systems and asset disposal process. #IEAKEBudget2023 23/N

AGPO remains a priority of GoK and the government has reingeneered the portal to enable policy to work better. #IEAKEBudget2023 24/N

Bloated payrolls are a large burden to the exchequer and creating curate pensions delays. A huge proportion of staff in most state corporations is non-technical staff and this will require rationalization. chasing a 70:30 ratio of technixal to support staff #IEAKEBudget2023 25/N

Cabinet approved privatization bill 2023 to stremaline process and restructure state owned enterprises. (Why should the bill aim at restructuring whne its name is about privatization?) #IEAKEBudget2023 26/N

Alludes to reforms in Kenya Airways and KPLC aimed at improving performance. KPLC reform will be to restructure balance sheet too improve liquidity gap. #IEAKEBudget2023 27/N

Transfer all asset lines to KETRACo and settle outstanding Rural electification scheme costs. To reduce system losses from 24 to 14% in a timeframe that I havent heard well. #IEAKEBudget2023 28/N

For KQ, GoK to ensure turnaround to make it a PanAfrican carrier. #IEAKEBudget2023 29/N

Management of pensing bills is a challenge. It is an important benchmark for public to judge overall integrity and management by GoK. (Good ststament) #IEAKEBudget2023 30/N

Cabinet papare to establish a clarification committee for pending bills and advise. To make Pending bills a first charge on budget of the entity in succeeding years. #IEAKEBudget2023 31/N

To

Central Securities Depository to be established to enable deeper markets. #IEAKEBudget2023 32/N

CBK and others will undertake a comprehensive review of the National payments Act of 2011 and the regulations and examine its firness for purpose. #IEAKEBudget2023 33/N

To reduce money laundering, the CBK has enghanced KYC regulations to strenthen effectiveness of AML and comabting financing of terrorism. #IEAKEBudget2023 34/N

The KDIC is reviewing coverage limit of 500K to acsertain its adequacy in protecting SMEs. (Interesting) #IEAKEBudget2023 35/N

Coverage aegued to be low and this calls for extension of informal sector. A National Pensions policy to be published to address low coverage. #IEAKEBudget2023 36/N

Strategic partnership to motivate voluntary pensions contributions.#IEAKEBudget2023 37/N

Public service pension schemens to provide user friendly user platforms to aloow savers to access information and receiving payments conveniently. #IEAKEBudget2023 38/N

Insurance Rgeulatory Authority to roll out a micro-insurance framework to expand coverage for indivdiduals with low incomes. #IEAKEBudget2023 39/N

Insurance maendment bill submistted to contain amendmenets aimed at ensuring effeiciency of regulator and respond to misdemenaours in the industry. #IEAKEBudget2023 40/N

Competition Authority will exempt MSEs from merger control. (Good point but there is reason to investigate cartelized behaviour but firm size should not be an issue. #IEAKEBudget2023 41/N

GOK to scale up revenue collection to target of Kshs. 4.0 trillion over the medium term through tax policy reforms and administrative measures .#IEAKEBudget2023 42/N

GoK to finalize the National Tax Policy to enhance efficiency of the tax system and provide certainty in tax administration and manage tax expenditures. #IEAKEBudget2023 43/N

KRA to be enabled by machines to monitor activity in real time and prevent revenue leakages. #IEAKEBudget2023 44/N

revenue porjections; Total reveneu collections projected at Kshs. 2.96 T or 18.2% of GDP. Ordinary revenue to be 15.8% of GDP. 45/N #IEAKEBudget2023

Fiscal deficit of ~700 B to be financed by domestic financing (3.6% GDP) with the rest frome xternal financing. #IEAKEBudget2023 46/N

"Kenya's public debt remains sustainable but with elevated risks..". ( iw ould think some debt rating agencies would disagree). #IEAKEBudget2023 47/N

Current limit of debt as approved by parlaiment is Kshs. 10T and Gok intends to change ceiling from numerical anchor in form of Debt to GDP in present value terms. (I think this doesnt change anything and has been a consistent dance since 2015). 48/N

Alludes to Public Debt Finance Management Amendment Bill 2023 and urges National Assembly to consider it favourably. ( I would change key work "favourably" to "carefully") 49/N

Fiscal position remains strong and GoK committed to meeting obligations that fall due. (This is not a matter on which GoK has discretion because the constitution doesnt contemplate debt repudiation or default). 50/N

Rest of teh speech is a rehash of spending proposals contained in the appropriations bill and which is presented in @IEAKenya fact sheet #IEAKEBudget2023 51/N

ieakenya.or.ke/?wpdmdl=3041

Here is a graphical representation of the split of spending among the various arms og government. It is available on page 3 of @IEAKenya's fact sheet #IEAKEBudget2023 52/N

From CS: Cash transfers will be linked to GoK monthly payroll to prevent delays in payment. (Excellent proposals once the payroll is purged of ghost workers) #IEAKEBudget2023 53/N

Here's the distribution of spending within the Consolidated Fund Services (CFS). Most revenue is still paying for public debt. #IEAKEBudget2023 54/N

From @IEAKenya fact sheet (page 6) showing amounts going to debt repayment by principal sums and the interest payments. #IEAKEBudget2023 55/N

Here's debt servicing costs as a ratio of the ordinary revenue anticpated for the next financial year. #IEAKEBudget2023 56/N

The decomposition of the ordinary revenue that GoK anticpates will be collected once the Finance Bill 2023 is approved. #IEAKEBudget2023 57/N

The Cabinet Secretary has said something about protecting domestic market from "cheap imports". Who told GoK that we buyers want protection from cheap goods, wherever they may come from? #IEAKEBudget2023 58/N

Explaining 3 tax bands as a precursor to introducing two new tax burden to make it more progressive. Proposes to introduce band employees earning marginal tax rate of 32.5% ( income >500,000 per month) and 35 % ( income above 800,000 respectively for #IEAKEBudget2023 59/N

This is a bad idea because it is merely symbolic in terms of progressiveness but doesnt generate much revenue. In addition, the marginal tax rate of 35% will not apply to MPs and public sector workers whoe income comes disproportionately from allowances. #IEAKEBudget2023 60/N