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{
    "id": 509321,
    "url": "https://info.mzalendo.com/api/v0.1/hansard/entries/509321/?format=api",
    "text_counter": 62,
    "type": "speech",
    "speaker_name": "Hon. Musimba",
    "speaker_title": "",
    "speaker": {
        "id": 1804,
        "legal_name": "Patrick Mweu Musimba",
        "slug": "patrick-mweu-musimba"
    },
    "content": "collecting. When you look at our portfolio of ranking of our dollar and gold reserves in Kenya, you will see that we are currently ranked 9th in Africa and 91st in the world with just a reserve of US6.4 billion dollars. It has not been revealed what the mix is, but it challenges our ability to protect our currency from foreign currency fluctuations. Kenya is a net importer and it will put significant pressure on the shilling, which will mean the cost of our bread basket will be greatly affected. So, in echoing the words of some of our colleagues, I would seriously recommend that this Report goes back to the Budget and Appropriations Committee. Much of what they have said about this Bill, even in their opening presentations, is not consistent with what we have. When they were citing a country like Japan having a big debt ratio - they can have a big debt ratio as they are currently ranked number two in the world - in terms of holding foreign exchange, only behind China with US$ 1.2 trillion in their reserves, their basket is pretty rich. We can go the Angolan way. I am just giving different alternatives because we are a House which should recommend support for their own Government. We can go the Angola way where they went and swopped their oil for development. Where we are citing projects like the Standard Gauge Railway (SGR) for instance as a primary thing which is putting pressure, I think the accounting for that particular aspect has been done wrongly. Earlier presentations in Committee, as regards the SGR was that we will have a moratorium period of not less than eight years over the loan. Financial practice is such that you cannot book the debt when there is a moratorium period. All what you can book is the interest that will accrue over that eight year period. Therefore, when you look at the presentation which has been given which says we will have a deficit of Kshs 30 billion and Kshs 8 billion, it is not true. It is a complete misrepresentation of the financial exposure that this country is actually faced with. Hon. Speaker, I wish to state in the strongest terms that when we take a stock of debt of US$64 billion, we are not even talking about generations to come; we are going to punish this country in the next four months. This is because everything will spiral outward, as we were looking at it. We cannot cushion the impact. If we made a bigger investment in terms of gold and say that whatever increment into the international market will cushion the underlying pressure that the Kenya shilling will be under, as we move forward, I would recommend that we move that way. However, seeing that we have fiduciary or other alternative ways of being able to raise this money--- When you look at the rebased value of our economy in terms of Gross Domestic Product (GDP), it is only at Kshs 4.7 trillion. When you take a total debt stock of Kshs 5.6 trillion, it will represent over 100 and almost 12 per cent of our GDP. This should be worrying to every Member of this House because we will have busted. Even in hon. Langat’s presentation, he said that World Bank recommends 74 per cent. In this particular scenario, if you take the total debt portfolio against a GDP growth, even if you accumulated it at 10 per cent per year, you are only looking over a four year period of us accumulating only Kshs 1.6 trillion over our GDP. We will still be in the red. This fact cannot be negated by anyone. You know, that has been very optimistic. Over the last four years, we have been talking about a growth level of varying between 4 per cent to 7 or 8 per cent at best, if you do not take the inflationary pressures which are there. The electronic version of the Official Hansard Report is for information purposesonly. A certified version of this Report can be obtained from the Hansard Editor."
}