As media fills its pages with tough questions, it doesn’t take a genius to know that consumer spending is up. The country is bourgeoning with global brands in new malls, making our neighbours happy with huge food imports in excess of $1 billion in the first six months as well as changing lifestyle with more people increasingly eating outside the home as new global restaurants scamper for space to whet our increasing appetites for foreign foods.

What is going on? These contradictions make it harder for any economist to predict whether we are headed for a recession or economic boom.

If the economy is doing great as reflected in the GDP growth and we are petulant, then we are missing the opportunities that foreigners are seeing.
Two malls, Sarit and Village Market, have expanded their facilities and virtually all the spaces have been taken by global brands. At least four new malls have sprung up also housing several international brands, these brands don’t just randomly invest in emerging markets.

They do a lot of research beyond economic indicators like GDP per capita.

While we grumble that the government has not made us to think, non-Kenyans are seeing opportunity and exploiting it sometimes using inputs from their own countries.
We must be part of the solution to economic performance. In essence, we should wake up and exploit emerging opportunities.

The government cannot direct private citizens to areas of opportunity. It is the private citizen who takes the risk and exploits the opportunity and only seeks government assistance if there are unfair practices in the markets.
While most businesspeople simply duplicate enterprises their neighbours have built, there is need to helping others start imitating new business models of foreign enterprises. Asia’s Newly Industrialised economies faked their way until they started to innovate on their own.

When citizens and the media grumble and foreign entities continue to enjoy the benefits of economic expansion, we are failing to understand our economy and exploit available opportunities.

https://www.the-star.co.ke/news/2019-09-02-cs-yatani-imposes-three-year-freeze-on-hiring/

The government has frozen hiring for the next three years in austerity measures to reduce the country's wage bill.

Government agencies are headed for budget cuts of monumental proportions following Treasury’s tough conditions for approving funding requests presented by ministries and state departments.

Targeted in the cuts are allocations for consumable goods, staff upgrade, ICT equipment and funding for parastatals.

Treasury CS Ukur Yatani wants the saved funds prioritised to drive the Big Four agenda “to build on the progress made so far as the state confronts unemployment, poverty and inequality.”

There will be no recruitment of staff in the next three years unless a ministry, state department or agency (MDA) gets the approval of the Treasury.

Yatani, in a circular to all principal secretaries and other accounting officers of the national and county governments, says there will be no costing for recruitment in the 2019-20 budget.

The directive further stops ministries from seeking funds for interns or any planned staff upgrades, meaning government workers may not get a pay rise soon.

Ministries will also be required to get written approval from Treasury confirming availability of funds before putting a salary review request to SRC.

“Allocation for personnel emoluments must be supported by Integrated Personnel Payroll Data (IPPD),” Yatani says in the circular with guidelines for the preparation of the 2020/21 – 2022/23 medium-term budget.

In the dossier, the CS gives the strongest hint that Treasury will no longer fund profitable parastatals.

Yatani, who took over from Henry Rotich - out of office on 24 charges related to the Arror and Kimwarer Dam scandals - is keen on weaning parastatals off state support.

He has proposed that money transferred to the entities be factored on their revenue base and the savings channelled to other sectors.

“Sector Working Groups (SWGs) should critically analyse the revenue-generating potential of SAGAs in their respective sectors,” he says.

The directive further stipulates that state agencies can’t bid for resources without a performance review, reports which must be presented prior to budget talks.

The Treasury boss has further maintained there will be no funding for projects with no clear output, key performance indicators and targets.

Ministries are expected to undertake programme performance reviews (PPRs) detailing the progress of targets spelt out in the financial year 2016-17 to 2018/19 budgets.

“Accounting officers should note that their respective MDAs will only be allowed to bid for resources after finalizing the reviews,” Yatani says.

Even when approved, the money will be given on the basis of how the funding need helps achieve President Uhuru Kenyatta’s Big Four agenda.

On this, accounting officers have been asked to review all proposed ministries, departments and agencies budgets for 2020-21 to align them to Big Four.

Other factors would be a project’s link to MTP3 of Vision 2030; the degree of addressing job creation and poverty reduction; cost-effectiveness, and sustainability.

“Each programme should be confined under one ministry and all functions should fall within programmes; there should be no duplication of programme names,” the CS directs.

Accounting officers have also been barred from presenting budget proposals before they analyse previous budgetary allocations, actual expenditure and achieved outputs.

Yatani is also pushing for cuts on consumable goods and services, saying no allocation will be provided unless the request is supported by service provision agreements.

Demand notes and documentary evidence of past trend – how the goods have been procured before - will be required.

The Treasury further warns ministries against exaggerating costs of budget needs, saying those that violate the set ceilings will be checked.

To regulate spending on ICT, argued to be a fertile ground for fictitious contracts in most government entities, Yatani has directed that the items be procured by the ICT ministry.

Ministries will have their computers, printers, networking equipment and software procured in one pool by the ICT ministry.

This will include procurement of ICT professional services and purchase of photocopiers, among other specialised equipment.

The CS has directed that for such a request to be approved, a state agency must justify to the SWG that the ICT Ministry has approved the same.

Treasury, in the circular, reiterated Uhuru’s order on new projects saying PSs and other accounting officers can only budget for them with the Exchequer’s approval.

Thanks for this. This is a no-brainer, braddah. The problem with many Wazooans is they think the sky is falling on their heads because baba Shiko told them at a bar that sijui Kengen fired three employees. Or when they tried to sell their crumbling bedsitter in Valley Arcade they got no bites, so the economy must be doomed. What sort of retarded logic is that? On the MACRO issues that actually matter -like the GDP growth rate for Pete's sake!- they go very silent. Yet Kenya's red hot GDP growth rate has been among the top tenth percentile in the whole world for well over a decade. Economy si porojo na fombe gossip my braddahs. There are competent people at CBK and KNBS calibrating what goes into a 6 percent annualized growth rate. I'm convinced that some Kenyans are just perpetual whiners. Peni mbili talk about one or two collapsed companies or a hiring freeze or sijui a rate of decline in profits on a micro scale may impress wazoo rubes but such micro issues tell any credible economist zero. As I said..to all the doomsayers on this thread...yaaaaaawn WAKE US UP when the gdp growth rate dips below 5 percent any time soon.

Shalom

Riddle me this.. Why are various companies laying off staff, closing branches, shutting down..

ha ha ha ha ha ha ha ha ha ha!
Can you even DEFINE GDP and tell us what components go into computing it?
Fanya research then come back and we have a proper discussion on why it stymies your mind that you are jobless in an economy that is booming at world beating GDP rates!

https://www.the-star.co....conomy-economic-survey/

You know you remind me of my friend Mung'ash. Mungash is a very proud, well educated guy with 2 degrees, one from abroad. Yet has been tarmacking for 10 years. I once asked him what he was waiting for. He said he was waiting for the "corrupt" gava to give him a neatly packaged job with thick benefits. I told him to his face..Mung'ash you is kurazy! Sirikali si mama na baba yagho. Gava's "job" is not to give you jobs. It's job is to create an enabling environment for you to create your own jobs. He became very angry with me and did not speak to me for a week. Meanwhile, mind you, mung'ash spends every coin he has having pombe at night and complaining bitterly about his country to anyone who cares to hear. Meanwhile broke and poorest of the poor bachina come here and start getting rich selling mtumba at Kariakor and people like Mung'ash are the first to want to chase them away! They even blame the Bachina for the economic woes of their country! It is good comedy to say the least, jameni.

Shalom.

@mugunda, many years back, this forum had brilliant analysts who would hold scintillating intellectual debates. The arguments were intelligent, the claims backed by data, the disagreements ideological.
You wouldn't know as you were still in school.
Those veterans never left. They still pop in once in a while.
It is their silence that scares me. When they don't see the need to respond to your wild claims which echo the jubilee's make-believe economic boom. A boom that only exists in their own pockets from stolen money.
In my profession, we have something called ISA 570. It is when we have to test an entity's ability to continue running as a going concern in the foreseeable future.

I fear you'll only get insults for your trouble. Some of the Wazuans not in business struggle to understand what those in business are talking about. Tenderpreneurs also can't relate. Not even the very publicly published declining financial fortunes of blue chip firms that we've witnessed in the last 3 years is enough to convince them that something is amiss.

Radisson, Marriot, Best Western, Sheraton, Ramada, Hilton and Mövenpick are among the international brands that are now flocking to East Africa to open new facilities aiming to capitalise on the projected tourism growth.
A new report by audit firm PwC dubbed Hotels Outlook: 2019–2023 report shows that the hotel industry in Tanzania and Kenya to be among the fastest growing on the continent.
Hotel room revenue for South Africa, Nigeria, Mauritius, Kenya and Tanzania as a group is projected to increase at a 5.8% compound annual rate to $3.3 billion in 2023 from $2.4 billion in 2018.