In 2013, we promised to put in place special financial incentives to support the role of the youth as the drivers of innovation in this country.
After 4 years, Kshs 11 Billion has been accessed by close to a million young Kenyans.
We celebrate the success of the Fund through the stories of young Kenyans like Irene Kaleye based in Embakasi whose start-up “Plan Believe Groceries” won a contract to supply vegetables to Kenyatta University. She received a loan of Kshs 1.5 million from the Fund to bridge her cash flows, which enabled her to fulfill her contract. We kept the promise.
Despite some teething problems, the National Youth Service Programme, through the recruitment of cohorts in Kibera has changed lives. They joined the SACCOS established, and managed to save 123 million shillings. This money has been utilized to start businesses and provide hope and gainful effort.
In 2013, we promised to provide social protection to our most vulnerable members of society.
Today, our National Safety Net programme “Inua Jamii” covers 720,000 persons up from 220,000 in 2013. The budget for this programme has also been increased by 600 percent to 18 billion shillings. These are beneficiaries like Mohamed Noor Adow from Bula Rahma village in Garissa township. He used to live a destitute life with his wife and 7 children. After enrolling to Inua Jamii in 2015, he received his first payment of 20,000 shillings which he used to purchase goats.
Today, with the continued support of the programme and his livestock trading business, he and his family are able to live a dignified life.
Fellow Kenyans, these are just some of the promises we have fulfilled during our term. We acknowledge that the journey of transformation is one we must walk with our people. I am therefore pleased to inform you that in the coming weeks, my administration will launch a public information platform to share in more detail the government’s delivery agenda during the last four years.
Let me now turn to the state of our economy.
At the macro level, all indicators are healthy. Our gross domestic product has expanded at strong average annual growth rate of 5.9 percent since 2013 this against a global average of 3 percent. Our Foreign Exchange reserves have increased from 4.3 months of import cover in 2013 to 5.1 months of cover at the start of 2017. Our revenues from tax collections have increased from 847 billion shillings in 2013 to 1.2 trillion shillings at the end of 2016.
The stable economic environment over the last 4 years has seen the cumulative addition of 2.3 million new jobs. From this perspective, the state of our economy is robust.
In spite of this good macro-economic performance, there are still too many Kenyans who are struggling to make ends meet, to find jobs, and to support their families. Wananchi want to know what these economic indicators mean to their lives. They cannot relate to how GDP impacts on the price of unga, or what the stability of our currency means for them at the end of every month. Many of our citizens are wondering why their children are still struggling to find jobs.
Others are worried that the government debt might too heavy a burden for our economy to carry. Our SMEs are complaining that they do not have access to credit in spite of the fact that the cost of credit in Kenya is the most affordable in the region after the capping of commercial bank interest rates in September last year. Many Kenyans are frustrated at the seeming lack of progress in the fight against corruption.
These concerns are legitimate and they are questions that every citizen is entitled to have answered by their government. Addressing them is of utmost importance to me so let me start by addressing the question of our public debt:
Our debt is about 50% of our GDP. Of that amount, less than half is in foreign currency. Our debt has grown almost proportionally to our GDP. Every year since the start of my administration, we have made adequate budgetary provisions to service the debt. I want to assure Kenyans that at no point has the country been at risk of default or shown any inability to pay its creditors.
Fellow Kenyans that the borrowing my administration has undertaking both from domestic and international creditors has been solely to finance the most aggressive development agenda witnessed in Kenya’s history.
The evidence of a greatly expanded transport infrastructure, increased energy production, increased access to electricity, and improved security are plain for all Kenyans to see.
As a responsible government serious about creating jobs, we have to have the right environment to attract investment. That investment, in turn, will lead to jobs and end to poverty. It will bring new economic opportunities across the country especially to previously marginal areas. I assure every Kenyan that all the funds borrowed will continue to be put to good use.
Like a farmer who must sow their seeds before they can expect a harvest, our investment in infrastructure will be the seed that will produce the harvest of faster economic growth and more jobs for our people. Kenyans are ready and anxious for an economy that is world class in attracting the investment that will turn us into a manufacturing powerhouse. My administration understands the scale of change our people need to improve their lives, thus our aggressive investment. At core, these are investments in Kenya’s future.
On the issue of access to credit for SMEs, it is unfortunate that the unintended consequence of the capping of interest rates was a slow-down in lending by our commercial banks. This is an issue that concerns us and is one that I will actively seek to resolve so that credit can start to flow again to the real drivers of our economy.