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Opposition kicks as Kenya raises fuel VAT from 8% to 16%

Published

1 year ago

June 26, 2023

The Kenyan presidency announced on Monday the launch of a finance bill that will see an increase in tax payments in the country.

The bill will begin an increase in VAT on fuel from 8% to 16%, and a payroll levy to finance a low-cost housing programme initially set at 3% was reduced to 1.5%.

Kenya is grappling with some financial issues as its national debt has increased to a high of 65 billion dollars, or 67% of GDP, and the cost of repayment is rising as the value of the Kenyan shilling declines.

Prior to the announcement on Monday, the administration had given hints about raising taxes in response to pressure to generate more income. Notwithstanding a cash shortage that has prevented the payment of civil service salaries, it has also insisted that it will not skip out on its debt repayment responsibilities.

Meanwhile, the new tax regime and revenue drive of the government have drawn criticism from the opposition. The opposition coalition, Azimio, led by Raila Odinga, accused President William Ruto of reneging on his election promises to improve living conditions for Kenyans.

Odinga’s spokesman, Dennis Onyango told journalists on Monday that their “position remains that the Bill is a mistake and an experiment Kenyans can ill afford.”

For creditors like the International Monetary Fund, the financial reforms are commendable and “prompt” to the economic challenges. Although it warned that while the medium-term outlook is “favourable” for the Kenyan economy, “significant challenges remain against the backdrop of slow global economic growth and tight financial conditions.”

Despite its financial stress, however, the World Bank said the recent progress in the agricultural sector would likely lead to Kenya’s economic growth at a slightly faster pace than last year. The international lender in its latest biannual Kenya Economic Update report said the economy would expand by 5.0% in 2023, inching up from 4.8% last year.

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Moroccan annual inflation rises to 0.8% in November

Published

1 day ago

December 21, 2024

Ifeoluwa Dada

Morocco’s statistics office has confirmed that the country’s annual inflation rate, as determined by the consumer price index, increased from 0.7% in October to 0.8% in November.

Monthly, consumer prices decreased by 0.2% from October.

The primary driver of inflation, food costs, grew by 0.8% compared to the previous year, while non-food inflation climbed by 0.7%. Core inflation, which does not include more erratic items like food, increased 2.6% annually and 0.2% monthly.

According to the central bank, inflation is expected to average 1% this year, down from 6.1% last year.

Despite the Al-Haouz earthquake, a spike in inflation, and worldwide economic challenges, Morocco’s GDP grew by 3.4% in 2023.

A recovery in tourism, robust industrial exports, and rising private consumption—all bolstered by prudent macroeconomic policies—were the main drivers of growth.

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Nigeria’s $42bn foreign reserves enough for 9 months’ imports— Central Bank

Published

2 days ago

December 20, 2024

Ifeoluwa Dada

According to Olayemi Cardoso, Governor of the Central Bank of Nigeria (CBN), the nation’s $42.01 billion in foreign reserves can cover imports of goods and services for almost nine months.

Cardoso promised Nigerians improved economic fortunes in 2025 while addressing the Senate Committee on Banking, Insurance, and Other Financial Institutions yesterday in Abuja at the presentation of the performance index report.

Cardoso stated: “External Reserves rose from $ 38.35 billion it was on September 30, 2024, to $ 42.01 billion as of December 12, 2024”.

He clarified that third-party receipts in Q3 2024 and revenues from taxes connected to crude oil were the main drivers of the rise in foreign reserves during the specified time.

“We saw remarkable improvements in our trade balance and maintained a current account surplus,” he added.

“Our external reserves level can finance over 9.09 months of import of goods and services or 13.91 months only, higher than the international benchmark of 3.0 months and a robust buffer against shocks”.

On cash shortage, the CBN boss reiterated the N150 million fine against any branch of banks caught illegally distributing new Naira notes to currency hawkers and unscrupulous elements and said the Nigerian economy will improve in 2025 through policies and measures.

He predicted a stronger economic future: “Despite our economy’s challenges, there are clear reasons for optimism.

“The gradual stabilization of the forex market, ongoing banking sector recapitalization, and positive growth trends in key sectors, especially the services sector, indicate a path toward recovery and stability.”