Fiscal reforms get Sh7b Danish boost

December 14, 2010 12:00 am

, NAIROBI, Kenya, Dec 14 – Kenya has received a Sh7 billion grant from the Danish government which will go towards strengthening the public financial management reforms and improve the business climate for the private sector to operate in.

Part of the funds will be used to upgrade the Integrated Financial Management Information System, which bundles together Budget Preparation, Budget Execution, Accounting and Financial Management to ensure transparency and accountability in the spending of public finances.

"It will make it possible for the government to have a better feel of how funds are being spent. We will also look at revenue collection and see how we can improve it to make it more efficient," said Danish Ambassador Geert Aagaard Andersen.

The grant falls under the Danish Embassy’s Kenya Governance Support Programme and the Business Sector Programme Support (BSPS) through which the European government has been supporting governance and private sector development in the country.

Out of the Sh7 billion kitty, Sh2.5 billion will be used to support governance aspects such as the electoral process, civic education, gender equality and legal reform in a bid to reduce impunity and have an informed populace.

"The Kenya Governance Support Programme will be implemented from 2011- 2015 to coincide with all the important agenda of implementation of the new Constitution," Mr Andersen said.

The remaining funds will be used to improve access of farm produce to markets through ensuring an efficient value chain in the agricultural sector. The move is not only expected to lead to rural development but also the creation of employment for the thousands of jobless youth in those areas.

Speaking after signing the agreement with Finance Assistant Minister Dr Oburu Odinga, the envoy said the support demonstrate the confidence that his government has in Kenya.

The grant brings to Sh40 billion the total amount that has been extended by Denmark to Kenya to finance various programmes and projects.

On his part Dr Oburu who read the speech on behalf of his minister Uhuru Kenyatta said the government was committed to the implementation of financial and economic reforms as demonstrated by among others the promulgation of the new constitution in August.

Ensuring good governance, he said, would not only improve government’s accountability to the citizen but also stimulate economic growth.

But while he pointed that the economy was back on the growth trajectory, with projections for this year being five percent, the assistant minister acknowledged that there were challenges such as unemployment and poverty that may impede the Gross Domestic Product.

However, he sought to assure that the government was investing heavily in infrastructure development and has increased allocation to devolved funds as a step towards addressing these gaps.


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