NAIROBI, Kenya Mar 25 – National Assembly Majority Leader Aden Duale wants the National Treasury to consider establishing long term government bonds to bolster efforts to cushion the economy from collapsing due to the impact of the Coronavirus.
Duale is proposing that the 50-70-year government bonds should be targeted at high yielding blue-chip companies such as Telco giant Safaricom, East African Breweries Limited, British American Tobacco Kenya Limited and various commercial banks.
He says these are among the options he would want the National Assembly to deliberate on when it is recalled considering and to facilitate legislative proposals outlined by President Uhuru Kenyatta towards saving the economy from total collapse.
“Countries all over the world have put in place Stimulus package to cushion the Economy from this scourge that portends to bring the world economy to its knees. US have set aside 2 trillion Dollars, France USD 45 billion, Australia $17.6B and New Zealand $12.1B targeting mostly businesses and affected employees,” he said.
Apart from reassigning the budget and pushing for a stimulus package fund, the Majority Leader is recommending that the banks could wave interests on all commercial loans particularly the Small and Medium Enterprises and other vulnerable groups.
“We anticipate a massive disruption in businesses where employees are forced to work from home. Our economy is literally driven by SME’s that absorb most of the workforce and any disruption shall have a major negative impact on the economy,” Duale said.
This, in his view, will complement government efforts to review fiscal policies to enable borrowers to access funds from the commercial banks during the crises at friendly terms.
“KRA to waive taxes mainly income tax and revise the VAT due to anticipated rising costs of goods and services as a result of weakening shilling and due to no salaries to self-isolated staff working from home,” he said.
The Garissa Township MP joined former Vice President and Finance Minister Musalia Mudavadi in calling on the government to approach external lenders like China, the IMF, and World Bank to renegotiate repayment terms for the loans extended to Kenya.