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{
    "id": 270463,
    "url": "https://info.mzalendo.com/api/v0.1/hansard/entries/270463/?format=api",
    "text_counter": 350,
    "type": "speech",
    "speaker_name": "Mr. Onyonka",
    "speaker_title": "The Assistant Minister for Foreign Affairs",
    "speaker": {
        "id": 128,
        "legal_name": "Richard Momoima Onyonka",
        "slug": "richard-onyonka"
    },
    "content": " Mr. Speaker, Sir, what is critical in this Report is that we need to ask ourselves what the responsibility of the CBK was. The second question we should ask ourselves is what the Governor of the CBK should have done. Under the circumstances, the Report says very clearly that the CBK opened the window, which is normal. Central banks all over the world lend money to commercial banks because a central bank is the lender of the last resort. The Committee went out and found that this money was actually given at rate that was lower than the inter-bank rates. We need to ask ourselves, as Members of this House, why the Governor made that decision. Did he make that decision because it was prudent or did he make that decision because it was the right thing to do at the time? If commercial banks took this position, where they borrowed Government money from the CBK and bought TBs at rates which were going to become advantageous to them, in the process causing the Kenya Shilling to spiral down to an extent of losing value by 20-30 per cent, to me, there is an issue touching on the credibility of the Governor of the CBK. Mr. Speaker, Sir, any economics student will tell you that the role of the CBK is to manage the micro policy of the country. I believe that, under the circumstances, the responsibility of this House is to ask ourselves whether the Governor of the CBK managed the micro policy of this country for the Kenyan Government not to lose in terms of the ordinary mwananchi being unable to purchase the very basic necessities for his survival. Finally, when the Kenyan Shilling spiralled to Kshs110 to the US Dollar, what did that mean to those of us importing goods into this country? Was that purely an accident or was it by design? From what the Report shows, this was by design. If this decision was taken purely by the Governor of the CBK himself--- Mr. Speaker, Sir, I know that under the micro policy of the CBK, there is a committee which handles this matter and which deals with it. Did this committee sit? In the Report, I have not seen whether the House Committee actually consulted the committee that handles the micro policy in terms of interest rates and money circulation in the economy. My argument is that if that was what happened and the CBK Governor made a decision that caused the Kenya Shilling to lose value against major currencies of the world, then there was something wrong. Finally, my argument is very simple. I saw yesterday in the Press one of the executives of the banks said that it was not Kshs600 billion. I was happy that the Chairman actually said that this money was cumulative. Over a period of two months, there was a cumulative value of over Kshs600 billion; this was Kenya Government’s money, which the banks used in speculation and made Kshs28 billion. If this is what happened and evidence has been provided by the Committee, then there was something terribly wrong about our monetary policy at the CBK. With those remarks, I beg to support."
}