Kenya’s economy is forecast to register a growth of 5.5% this fiscal year, the National Treasury and Planning Ministry said in its Budget Policy Statement(BPS) released this Thursday.
- In this medium-term plan, both revenue & expenditure have been downgraded by KSh 10.6 billion.
- Recurrent spending is down by KSh 14.3 billion from KSh 2,873.6 billion to KSh 2,859.3 billion while development spending has been revised from the initial KSh 881.3 billion to KSh877.8 billion.
- While the draft BPS had proposed County transfers at KSh 438.9 billion, this figure has been enhanced to KSh 446.1 billion0, an increase of KSh 7.2 billion.
To cover the fiscal deficit, the government plans to raise KSh 326.1 billion in net external financing, and another KSh 377.7 billion from the domestic market.
The government has also upgraded the forecast for 2024’s investment from the 19.2% of GDP captured in the Draft BPS to 19.5% of GDP in the Final document. Also worth noting is that the Final BPS gives a granular breakdown of pending bills for June 2023, disaggregated across principal & interest. PAYE alone has KSh 20.0 billion in pending bills.
Overall spending will rise to KSh 4.19 trillion ($28.90 billion) from an estimated KSh 3.90 trillion in this fiscal year, the Treasury said.
The Draft 2024 BPS was first published on 18th December 2023 with Treasury inviting comments from the public, through a window that closed on January 5th 2024. The BPS sets out the broad strategic priorities and policy goals that will guide the national government and county governments in preparing their budgets both for the following financial year and over the medium term.
Parliament has until February 28th 2024 to approve the BPS with the consolidation of draft budget estimates expected to be done by April 12th2024.
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