Increasing Diaspora remittances and growing fortune in the tourism sector are some of the programmes under focus in Kenya’s Fourth Medium Term Plan (MTP IV) that seeks to propel Kenya’s economy to the next level by 2027.
- The Fourth Medium Term Plan (2023-2027) aims at increasing diaspora remittances from KSh478.5 billion in 2022 to KSh1 trillion in 2027.
- Priorities in the 2023-2027 plan are organised in five sectors of Finance and Production, Infrastructure, social, environment and natural resources and Governance and Public Administration.
- The implementation of will require approximately KSh 16,136 billion, up from an estimated budget of KSh 11,538 billion for Medium Term Plan three (MTP III).
This plan entails establishing products targeting diaspora including bonds, private equity funds, venture, and investment in affordable housing. Developing strategy to eliminate bottlenecks and reduce remittance transaction costs and facilitating establishment of diaspora SACCOs are also areas targeted to boost the cash inflow from Kenya’s Citizens living abroad.
The plan also strives to establish county investment products for the diaspora by identifying and disseminating diaspora county investment profiles, holding county investments fora and promoting diaspora investments.
The Government says it will develop a Diaspora Integrated Information Management System (DIIMS) and operate a 24-hour response centre for both evacuation and repatriation of diaspora during distress period.
The Kenya Vision 2030 has guided development planning since 2008. Implementation of the Vision 2030 has been through successive five-year Medium-Term Plans (MTPs): First Medium-Term Plans 2008-2012; Second Medium Term Plans 2013-2017; and Third Medium Term Plans 2018-2022.
The Fourth Medium Term Plan (2023-2027) will implement the last five-year phase of the Kenya Vision 2030, leaving only two (2) years to the end of the 22-year long-term blueprint.
Funding the Implementation
Approximately 83 per cent will be funded by the Government of Kenya, 12 per cent will be funded through PPPs, 1 per cent will be funded through development partners while 4 per cent will be funded jointly by Government of Kenya and development partners.
The resource gap will be bridged through expansion of the tax base, strengthening partnerships, engaging with the private sector through PPPs and green financing.
During the implementation of the third term medium plan, Kenya identified the over-dependence on nature-based products, specifically beach and safari products and loss of biodiversity, vanishing glaciers in Mt Kenya and Mt Kilimanjaro, rising sea levels as some of the key challenges facing the tourism sector.
However, the tourism sector earnings increased from KSh 157.4 billion to KSh 296.2 billion against the target of KSh 650 billion and KSh 750 billion in 2018 and 2019, respectively.
The earnings dropped in 2020 to KSh 88.6 billion against a target KSh 915.2 billion followed by an increase to KSh 146.5 billion and KSh 268.1 billion in 2021 and 2022, respectively. The improvement in tourism earnings in 2021 and 2022 was attributed to re-opening of Kenya’s source markets, and relaxation of travel restrictions.
To turn around the fortunes of the sector, In the Fourth Medium term plan has prioritized engagement of Kenyans in diaspora to market the destination in 12 source and emerging markets, developing and translating marketing materials in 6 foreign languages and holding four roundtable meetings annually with Kenyan Ambassadors and diaspora community.
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