Ruto must set the right tone for growth, jobs – Business Daily
Economic growth concept. PHOTO | SHUTTERSTOCK
Kenya will today (Tuesday) usher in a new government with the swearing-in of President-elect William Ruto as its fifth Head of State, completing a political transition that has been watched closely by investors.
Fixing the economy is the immediate task for the new administration. A good place to start is sending the right signals to investors, whose capital Kenya is competing for with other countries in the region. This will require well-thought-out economic policies that will anchor Kenya’s growth momentum into the next decade.
Already, a number of key economic indicators are blinking red and will require difficult decisions to be made. Inflation, a measure of the cost of living, has risen sharply in recent months to hit a 62-month high of 8.5 percent in August. The shilling continues to lose ground against the dollar and is now trading at 120.3 for every unit of the greenback.
The public wage bill consumes nearly half of the taxes collected while debt is a ticking time bomb. Slowdowns in manufacturing and stagnation in agriculture are pulling down the engines of the economy from hitting double-digit growth. But it is dealing with unemployment, which doubled in the last decade, that will keep the new administration on its toes most.
Creating new jobs requires a thriving private sector that is not competing for credit with the government. It also requires a level playing ground for all players in the economy and an enabling environment that will nurture innovation and growth of startups, which are critical in generating jobs and wealth for generations to come.