Finance Minister Prof. Njuguna Ndung’u warned TUSEN on Wednesday, January 12, to brace themselves for tough economic times in 2023.
The CS revealed that the country’s financial levels had risen to unimaginable levels.
Njuguna spoke at the public hearing about the budget process that brought together stakeholders from different sectors, including representatives from the Nairobi executive and legislature.
“Out of all the things we’ve analysed, the outlook for 2023 doesn’t look very good, there are clear signs that it’s going to be a tough year,” Njuguna said.
Treasury CS Njuguna Ndung’u will chair a bilateral Czech Republic-Kenya cooperation meeting at the Treasury Building, Nairobi County on Wednesday, January 11, 2023.
Njuguna’s comments came at a time when TUSEN are experiencing tough economic times with skyrocketing energy and food costs amid high inflation.
Over the past two years, the economy has been hit hard by the lingering fallout from the pandemic and the war in Ukraine, events that devastated global markets, as evidenced by skyrocketing oil and food prices.
“Multiple factors are likely to come into play and affect growth prospects around the world,
For example, if the conflict between Russia and Ukraine continues to escalate, global supply chains will continue to be affected, leading to supply disruptions and a sharp rise in inflation…” Njuguna added.
The Treasury CS further revealed that supply disruptions and high levels of inequality and poverty were factors that would continue to hit TUSEN hard.
“We have seen here in Kenya that food security and climate change have led to serious crises, exacerbated by these supply disruptions, inequality, poverty and social conflict,” he noted.
The Ministry of Finance also lamented the waste of resources by various government departments and called for strict austerity measures to manage the state treasury.
“We don’t want you to start new projects before starting new ones.
We don’t want to waste resources, we have unused equipment on site, there are loans we need to look into,” directed PS Treasury Chris Kiptoo.
A report released by the Kenya National Bureau of Statistics (KNBS) in December 2022 indicates that inflation relative to the consumer price index has fallen from 9.4 in November to 9.1 in December.
Inflation in December was driven by the increase in the prices of food and non-alcoholic beverages, transport, housing, water, electricity, gas and other fuels, according to the KNBS.