President William Ruto chaired a Cabinet meeting at State House, Nairobi o Thursday, November 14, 2024, where the government discussed the impressive progress made in the country’s economy.
The meeting focused on Kenya’s remarkable macroeconomic stability and the successful outcomes of deliberate fiscal management over the past two years.
According to the Cabinet briefings, Kenya’s economy is continuing its recovery, showing resilience despite both global and domestic challenges.
Economic growth has remained robust, with a growth rate of 5.6% in 2023 and an expected growth rate of 5% in 2024, followed by another 5.6% in 2025.
This strong performance positions Kenya among the top global economies in terms of growth, signaling the effectiveness of the economic reforms put in place under the Kenya Kwanza government.
One of the key achievements highlighted during the meeting was the sharp decline in inflation, which had previously soared to 9.6% in September 2022.
As of last month, inflation had dropped significantly to just 2.7%. This figure represents the lowest inflation rate in Kenya since 2007, during President Mwai Kibaki’s tenure, and is in line with the targets outlined in the Kenya Kwanza Manifesto.
This achievement has helped reduce the cost of living for Kenyans, especially in terms of food prices. For instance, the cost of basic food items, particularly maize, beans, and peas, has decreased significantly. A 2kg packet of maize, which was retailing at KSh 176 a year ago, is now selling at KSh 124.
The Cabinet was also briefed on the state of Kenya’s foreign exchange reserves, which have reached an all-time high of $9.5 billion, an increase of $2.4 billion from previous levels.
This increase provides Kenya with the equivalent of 4.4 months of import cover, strengthening the country’s ability to withstand external shocks and economic pressures.
In addition to inflation and foreign exchange reserves, the Cabinet discussed the favorable movement in the exchange rate. The Kenyan shilling has stabilized at KSh 129 to the US dollar, a substantial improvement from KSh 162 earlier in the year.
The meeting was further briefed that the country’s economic growth has remained steady and ranks among the highest globally, at 5.6 per cent in 2023, with an estimated growth of 5 per cent this year and 5.6 per cent next year.
This strengthening of the shilling has eased the burden of external debt by reducing the cost of debt servicing, further improving the country’s fiscal position.
With this stabilization, the government has been able to create fiscal space, resulting in decreasing domestic interest rates, which will benefit both businesses and consumers by lowering borrowing costs.
The Cabinet also received positive updates on Kenya’s revenue collection. The Kenya Revenue Authority (KRA) reported a double-digit growth in tax collections, with revenue increasing by 11.5% for the year ending June 2024.
This rise in tax revenues demonstrates the government’s improved ability to mobilize resources, which is essential for financing infrastructure and social development projects.
On the food security front, the Cabinet was informed that Kenya’s food situation remains stable due to the government’s ongoing subsidized fertilizer program, which has provided crucial support to farmers.
As a result, most Kenyan households now have access to basic food items. The country’s stocks of staple foods are strong, with 95.2 million bags of maize, 8.8 million bags of beans, 10.4 million bags of wheat, and 2.1 million bags of rice in reserve. This has helped mitigate the risk of food shortages and stabilize food prices.
For the first time, Kenya has achieved self-sufficiency in sugar production. The country will not need to import any sugar in 2024, a major milestone for the agricultural sector. This accomplishment is attributed to the government’s subsidy on fertilizers and improved management practices in the sugar industry.
The meeting also focused on labor migration, with the Cabinet receiving an update on the number of Kenyans securing jobs abroad. Since July 2023, a total of 105,367 Kenyans have been placed in jobs overseas, and another 16,943 have been cleared for employment opportunities.
The Ministry of Labour has signed bilateral labor agreements with Germany and Austria, and other countries identified as destinations for Kenyan workers include Australia, Qatar, Canada, Saudi Arabia, Oman, the UAE, the UK, Kuwait, and Northern Ireland.
These agreements are expected to create employment opportunities in a variety of sectors, including nursing, aged-care, education (especially in science, mathematics, English, and physical education), and other professional, skilled, and unskilled jobs.
To facilitate the process, the Ministry of Labour is conducting job recruitment drives across the country.
The Cabinet also received an update on the National Health Insurance Fund (NHIF), including progress in settling debts to healthcare facilities. Over the past month, KSh 5 billion has been paid to hospitals, including public, private, and faith-based institutions, to clear outstanding bills.
Additionally, the Cabinet was informed that more than 14 million Kenyans have now registered with the Social Health Insurance Fund.
The Ministry of Health also reassured Cabinet members that former NHIF employees who may be affected by restructuring will be reassigned to other government departments, ensuring that no jobs are lost.
In terms of infrastructural development, the Cabinet approved the upgrading of five Technical Training Institutes (TTIs) to National Polytechnics.
These institutes, including Michuki TTI, Mitunguu TTI, Ol’ Lessos TTI, Nairobi TTI, and Friends College of Research and Technology in Kaimosi, will now become National Polytechnics, bringing the total number of such institutions in Kenya to 28.
Another key decision was the transfer of Amboseli National Park to the County Government of Kajiado. This move aims to empower local governments to better manage national resources and enhance local economic development through tourism and other activities.
President Ruto also welcomed Deputy President Kithure Kindiki to his first Cabinet meeting since his appointment. He congratulated the Deputy President on his nomination and expressed his optimism about the future leadership of the country.
As Kenya continues to recover and grow, the government remains focused on fostering economic stability, increasing agricultural productivity, improving social services, and creating job opportunities for its citizens.
The positive economic indicators shared at the Cabinet meeting demonstrate the success of the administration’s policies, as well as the country’s continued progress toward becoming a regional economic powerhouse.
In conclusion, the Cabinet’s discussions highlighted the steady progress Kenya has made under the leadership of President Ruto.
The economy is growing at one of the fastest rates globally, inflation is under control, food security has improved, and the country is increasingly self-sufficient in key sectors like sugar.
With sustained fiscal discipline and a focus on job creation, Kenya’s future appears brighter as it continues to move toward greater economic prosperity.
