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KENYA ECONOMIC STIMULUS PROGRAMME

Introduction

An Economic Stimulus package is an attempt by a government to boost economic growth and lead an economy out of a recession or economic slowdown.

The Kenyan ESP was introduced in the 2009/2010 Budget Speech in parliament by Finance Minister Uhuru Kenyatta. Its aim was to jumpstart the Kenyan economy towards long term growth and development, after the 2007/2008 post election violence that affected the Kenyan economy, prolonged drought, a rally in oil and food prices and the effects of the 2008/09 global economic crisis.

The stimulus was made necessary by the decline in the economic growth rate from 7.1% in 2007 to 1.7% in 2009.

The total budget allocated amounted to 22 Billion Kenya Shillings (260 million US$), with the money going towards the construction of schools, horticultural markets, jua kali sheds and public health centres in all the 210 constituencies.

Key Objectives

1. Boost the country’s economic recovery;

2. Invest in long term solutions to the challenges of food security

3. Expand economic opportunities in rural areas for employment creation;

4. Promote regional development for equity and social stability;

5. Improve infrastructure and the quality education and healthcare;

6. Invest in the conservation of the environment;

7. Expand the access to, and build the ICT capacity in order to expand economic opportunities and accelerate economic growth.

Intervention Measures

The choice of intervention measures of the ESP are framed within broader policy objectives, as stipulated in the Vision 2030, (the current national development blue-print. Agenda 4, and the Constitution of Kenya.

Activities covered under the ESP include:

• Expansion of irrigation-based agriculture,
• Construction of wholesale and fresh produce markets,
• Construction and stocking of fishponds with fingerlings,
• Provision of aquaculture advisory services,
• Construction of ‘Jua Kali’ sheds and
• Tree planting
• Construction of social infrastructure such as schools, health centers and roads.

Governance Structure of the Economic Stimulus Programme

The ESP is governed by the Ministry of Finance, with the Minister for Finance as the overall leader

Overall Leadership - Deputy Prime Minister & Minister for Finance

Technical Working Group - Chaired by the Permanent Secretary to the Treasury and comprised of Senior Treasury Officials in the Ministry of Finance

ESP Secretariat - Officers from Budget Supplies and Economic Affairs departments

Project Implementation Units – Implementing respective Line Ministries of Health, Public Works, Education and Local Government

Stimulus Project Management Committee (SPMC) - Established by the Constituency Development Fund Committees (CDFC) at the constituency level.

Constituency Projects Tender Committee (CPTC) - Adopted from The District Project Tender Committee

External links

http://www.economicshelp.org/dictionary/e/economics-stimulus-package.html

http://www.tisa.or.ke/website/economic-stimulus-package.html

http://www.economicstimulus.go.ke/images/aboutus/stimulus_esp_manual.pdf

http://standrdkenation.com/topix/economic-stimulus-package.html