PRESS RELEASE: ICIFA Proposals for Kenya's Economic Recovery Plan after COVID-19 Crisis
5 April 2020
Members of the Institute of Certified Investment and Financial Analysts have put together a raft of measures to cushion Kenya’s economy from the negative impacts of the COVID- 19 pandemic.
According to a survey conducted by the Institute of Certified Investment and Financial Analysts (ICIFA), the Government of Kenya needs to urgently seek to re-finance its debt cheaply in the international markets with interest rates at 0%.
In the short term, the survey recommends fiscal consolidation at the National and County levels of government to reduce deficits and accumulation of debt. “In so doing, the Government could consider to engage fiscal consolidation to mitigate the risks of the pandemic failure to which could cause a rise in the cost of borrowing for the Government and undermine macroeconomic stability with widespread economic costs”, the survey report says in part.
Other short term measures include restructuring of the current Government debt, further reduction of the Central Bank Rate, price controls to prevent inflation due to reduced supply, good governance and proper use of resources.
Further, ICIFA opines that the Government must take prompt actions and short term measures on addressing emerging global issues by reducing poverty, investing in food security and growing the economy and reduction of Government spending on non-priority development projects and allocate the funds to more urgent sectors such as healthcare in increasing diagnostic capacity and setting up more ICU beds in the counties.
The proposals include embarking on public education of the citizens on crisis management to enable the country deal with situations of pandemics, enforce strong austerity measures through the National Treasury to ensure the country’s budget is balanced and surplus created.
The respondents of the survey opine that the Government should support public campaigns on personal budgeting to create a strong saving culture in Kenya. In summary, the survey identified the following priorities:
Invest in local manufacturing to avoid over reliance on imports at a time of crisis
Institute a robust healthcare system that is responsive to the citizenry and in constant communication with global trends
Invest in sufficient skilled medical personnel who are trained on pandemic response
Invest in research and innovation in the health sector
Effective monitoring of borders and entry points
Identify a committee of experts drawn from professional bodies from relevant sectors to provide recommendations on a quarterly basis on potential impacts on government directives.
69% of the respondents believed there is a high likelihood of a global recession with 54% of the respondents estimating a recovery period of less than or equal to 1 year.
The respondents of the survey were 93 ICIFA members with 55% of the respondents drawn from the private sectors, 31% from the public sectors and 14% respondents from the education, commercial and non-profit sectors.
The Full survey report can be downloaded from this link --> https://icifa.co.ke/static/resources/others/icifa-proposals-for-kenya's-econ.pdf