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Tuesday, 2nd March 2021
10:41:12pm

Kenya plans to increase FY 2020/21 budget spending by 4.1% - document

Kenya plans to spend nearly 121 billion Kenyan shillings ($1.11 billion) more on its budget for the 2020/21 (July-June) financial year, a Treasury document seen by Reuters on Wednesday showed, a 4.1% jump from the original plan presented in June.

The supplementary budget estimates presented to parliament said that the fiscal year 2020/2021 budget continues to face challenges, including “the effects of COVID-19 pandemic which slowed down the economic performance (and) underperformance of projected revenues in the first half of the financial year.”

The document said that total revenues have been revised to 16.7% of gross domestic product from the original projection of 16.8%, while overall expenditure and net lending has been revised to 25.8% of GDP from 24.6%. 

The fiscal deficit was now being projected at 8.9% of GDP for the fiscal year, compared with the 7.5% initial estimate in June.

Kenya’s economy, like others around the world, has been hammered by the coronavirus-induced crisis, as lockdowns instituted to fight off the pandemic reduced revenues and stifled growth.

Last month, the statistics office said that the economy shrank 1.1% year-on-year in the third quarter of 2020, compared with growth of 5.8% in the same period in 2019, as the pandemic slashed tourist arrivals into the country. 

But growth is expected to rebound from the slump, expanding by 6.4% in 2021 from an estimated 0.6% last year, the Treasury said in January.

-Reuters

 

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