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{
"id": 229731,
"url": "https://info.mzalendo.com/api/v0.1/hansard/entries/229731/?format=api",
"text_counter": 25,
"type": "speech",
"speaker_name": "Mr. Kibaki",
"speaker_title": "His Excellency the President",
"speaker": {
"id": 43,
"legal_name": "Emilio Mwai Kibaki",
"slug": "mwai-kibaki"
},
"content": "With regard to the newly launched Youth Enterprise Development Fund, my Government has already released the first disbursement of Kshs210 million to all constituencies while the balance of Kshs790 million will be disbursed through other financial intermediaries. These efforts have two essential objectives. The first is to provide seed capital to youth and women in small businesses who would otherwise not receive support from any other source. The second is to grow a generation of solid young businessmen and businesswomen who can generate income and create more employment opportunities. Mr. Speaker, Sir, the regional differences in natural endowments, and social and economic infrastructure have resulted in regional inequalities. My Government has, therefore, continued to channel substantial resources to the grassroots level through various devolved funds to finance development projects of the people's choice. Through the Constituencies Development Fund March 20, 2007 PARLIAMENTARY DEBATES 5 (CDF), for example, we have in the current Financial Year, allocated Kshs10 billion to be disbursed to all constituencies in the country. We have also allocated Kshs7.5 billion to the Local Authorities Transfer Fund (LATF) and a further Kshs10 billion for the District Roads Committees (DRCs). These funds, together with the Constituency HIV/AIDS Funds and Bursary Fund are transferring considerable sums of money to the grassroots. In addition to the devolved funds, we are also undertaking regional integrated projects for regions that require urgent affirmative action due to past neglect. Over the last four years, for example, the Government invested Kshs12 billion for the development of the arid and semi-arid districts in northern Kenya. My Government is now in the process of formulating an economic recovery programme to cover all districts of the Coast Province. Already, initial estimates show that the Government has spent Kshs8 billion on the completed projects in the Coast Province in the last four years. The projects cover a wide range of activities intended to spur economic growth, reduce poverty and increase employment opportunities. Mr. Speaker, Sir, with respect to rural electrification, the Government has over the last four years implemented the most ambitious programme to provide electricity to our rural communities and stimulate the growth of small-scale businesses in those areas. We have, in this regard, allocated more than Kshs7 billion for rural electrification in the last four years alone, compared to a total allocation of Kshs6 billion between 1963 and 2003. Mr. Speaker, Sir, sustained prudent fiscal and monetary policies in the last four years have resulted in lower interest rates and a stable exchange rate, providing a conducive macro-economic environment for investment. All these short-term interest rates were lower in June, 2006 than in June, 2005 and much lower than they were five years ago while Government borrowing from the market remains modest. Inflation has also been managed to enable relatively stable underlying rate of about 5 per cent. Income, corporate and Value Added Taxes (VAT) have largely remained unchanged, while most tariffs have been substantially reduced. My Government has consistently reviewed and revised laws and regulations to make doing business in Kenya easier and more friendly. As a result of these predictable, consistent and stable policy measures, business confidence is at an all time high among local and international investors. Private credit to the transport and communications sector is up by 33 per cent, while credit to the building and construction sector has increased by 38 per cent. Foreign direct investment increased to nearly Kshs80 billion last year, while the overall economy is estimated to grow by a minimum of 6 per cent for the year 2006. Several sectors and industries continue to post impressive growth rates. For example, tourism last year earned Kenya Kshs56 billion from 1.8 million visitors, horticultural export earnings rose to Kshs44.9 billion in 2006 from Kshs38 billion in 2005. Maize production increased to 38 million bags in 2006 from 32 million bags in 2005. The dairy sector grew at an impressive 24 per cent with estimated earnings of over Kshs70 billion. The communications sector saw impressive growth with over 7 million mobile phone subscribers. We will soon have one in every four Kenyans connected by mobile telephony. Similarly, cement production went up by 7.8 per cent, electricity consumption grew by 6 per cent, and consumption of fuel went up by 7.5 per cent. These trends of rapid and sustained growth can be seen across all sectors, showing that the economy has fully recovered. However, to achieve even higher rates of growth, some short and long-term measures are required to enable our producers, manufactures and service providers achieve higher levels of productivity. Mr. Speaker, Sir, with regard to agriculture, my Government will increase the capacity for our national food reserves by one million bags of maize from three to four million bags and 2,000 6 PARLIAMENTARY DEBATES March 20, 2007 tonnes for dried milk. We, therefore, plan to spend an additional Kshs1.8 billion to purchase maize and Kshs600 million to buy milk from our farmers this year. The fishing sector is also a major contributor to employment, food security and export earnings. The sector employs 60,000 people directly and 600,000 indirectly along our lakes and coastal shoreline. With regard to Lake Victoria, my Government has connected power to 20 fish landing sites, with work currently underway at two other sites. We are also assisting local fishermen to form co-operatives. Mr. Speaker, Sir, to sustain economic growth at 6 per cent and above per year, we will need to save and invest much more of our incomes that we are doing now. Savings and Credit Co- operative Societies, pension schemes, retirement benefits schemes, the National Social Security Fund (NSSF) and the National Health Insurance Fund (NHIF) are critical instruments for the mobilisation of savings. We will, therefore, be providing better policy incentives and regulatory frameworks to effectively use these savings to accelerate the country's economic growth. Mr. Speaker, Sir, the provision of quality physical infrastructure is critical to increase the economic growth rate from 6 to 10 per cent per year within the next five years. To expand the country's infrastructure base and make Kenya the most competitive country in the region, my Government will develop new financial instruments to fund infrastructure development by mobilising domestic resources. These include public-private partnerships and infrastructure bonds that will provide additional resources for investing in roads, electricity, water, ports, airports, railways and telecommunications. These measures will increase our capacity to finance and implement our infrastructure projects and provide programmes in a more timely fashion. For instance, it takes a minimum of three to four years to progress from inception to the ground-breaking for road projects financed through development assistance compared to one year for a road project financed from domestic resources."
}