Entry Instance

HTTP 200 OK
Allow: GET, PUT, PATCH, DELETE, HEAD, OPTIONS
Content-Type: application/json
Vary: Accept

{
    "id": 277048,
    "url": "https://info.mzalendo.com/api/v0.1/hansard/entries/277048/?format=api",
    "text_counter": 884,
    "type": "speech",
    "speaker_name": "Mr. Kimunya",
    "speaker_title": "The Minister for Transport",
    "speaker": {
        "id": 174,
        "legal_name": "Amos Muhinga Kimunya",
        "slug": "amos-kimunya"
    },
    "content": " Mr. Temporary Deputy Speaker, Sir, I believe that is an argument. If the hon. Dr. Nuh, who we respect for his age and enthusiasm was to read this amendment, he would see that it is basically saying that the maximum interest that a bank may charge - it is optional - is 22 per cent based on the CBR rate of 18 per cent today. It also says that the bank must pay deposit rates from tomorrow. I will be happy to get that but for now let me just proceed with my line. It also says that if we pass this amendment, the minimum interest that banks shall pay shall be 12.6 per cent on the deposit. Basically, we are saying that if everyone took advantage of the introduction of this clause, loans would be 22 per cent from tomorrow. This is because we have allowed them a leeway of up to 22 per cent. We are also saying that all deposits must be paid for at 12.6 per cent. We are allowing even a spread of close to up to 10 per cent. Currently, people are enjoying deposits even at 18 per cent. So, anyone who has a deposit at 18 per cent would have it automatically lowered to 12.6 per cent while anyone who has a loan at 20 per cent could have it going up to 22 per cent. This is only one of the implications. But the bigger picture we need to appreciate is that Kenya embraced a liberalized economic regime in 1994. Since 1994, we have been going to the world and telling people to come and invest in Kenya as the biggest economy within East Africa because we are a liberalized economy; other than the communists or centrally-controlled economies. People have come to this country and have invested, based on the confidence that they have been given not just by the Government but by this National Assembly passing laws that say we are a liberalized economy. Immediately you pass this, what signal will you be giving to people who want to come to the country to invest on the understanding that it is a liberalized economy and then tomorrow you tell them that you will control them? You are basically telling them: “Pack up and go to Rwanda and Burundi and leave Kenya because we do not need investors in Kenya.” That is the danger. Much as it may look populist, let me also remind hon. Members that the rate we are talking about here--- We have not even defined what rates we are talking about. We are saying that the rate has to be determined by the Monetary Policy Committee. We are not talking about rates. Is it the interbank rates? Is it the CDR rates? Is it the new rates to be determined for purposes of loans? Suppose the Monetary Policy Committee sat tomorrow and set the rate at 50 per cent? Is that what we want? Let us not do these things from a very emotional perspective. Let us not do it for purposes of settling some political scores or wanting to be populist. We are going to lose out. Mr. Temporary Deputy Chairman, I think it is important. This is a fundamental issue and we should have discussed it at the Second Reading, so that we can have enough"
}