NAIROBI, Kenya, Apr 5 – A section of Members of Parliaments allied to Deputy President William Ruto have called for mitigation measures for residents of the five counties currently under lockdown, due to the COVID-19 pandemic.
Led by Kikuyu Member of Parliament Kimani Ichungwah, a former Chairperson of the National Assembly Budget Committee, the legislators urged the government to use the recently approved Sh257 billion loan from the International Monetary Fund to support the worst hit groups especially small-scale businesses.
Also present during the press conference was Nakuru Senator Susan Kihika and Dagoretti South MP John Kiarie.
“The situation on the ground is different. Things on the ground are difficult for our people. Immediate and urgent measures need to be instituted and all efforts and energy be re-directed to this devastating situation facing our people,” Kihika said.
“Failure to respond to the situation will be tantamount to fueling the brewing anger and desperation among the people. A situation that can only be catastrophic for our lovely nation.”
Kihika urged the government to institute urgent measures that will cushion Kenyans against an economic meltdown caused by the pandemic and worsened by some of the containment measures.
The situation is even precarious for the zoned counties of Kajiado, Kiambu, Machakos, Nakuru and Nairobi, where the President directed bars to be closed while eateries are only providing takeaway services.
“In order to meet the stringent IMF conditions attached to these loans approvals, it is imperative that the country embarks on an aggressive programme towards fiscal consolidation driven by growth in revenue in order to sustainably manage both the debt levels and debts serviceability,” the lawmakers said in a joint statement.
“It is our strong believe that this will be achievable only through the expansion of our taxes and not by overtaxing the existing base of taxpayers.”
The National Treasury said the newly acquired facility, which is under the IMF’s Extended Credit Facility and Extended Fund Facility, includes an initial disbursement of Sh79 billion, due for release by June 30th, 2021.
Treasury further revealed a total of Sh33.7 billion will be released immediately and will be usable for budget support.
Commenting on the approval of the facility, IMF’s Deputy Managing Director and Acting Chair Antoinette Sayeh said the facility will also be used to safeguard resources to protect vulnerable groups
Sayeh said the COVID-19 shock has exacerbated the country’s pre-existing fiscal vulnerabilities, but said its debt remains sustainable.
She however warned that Kenya is at high risk of debt distress.
“To address debt-related risks, the authorities have taken action to hold the fiscal deficit and debt ratios to 8.7 and 70.4 per cent of GDP, respectively, this fiscal year. Fiscal and balance-of-payments financing needs remain sizable over the medium term,” she said.