Kenya’s Fresh Ksh 25 Bn Stimulus Package to Accelerate Economic Growth

The growth recorded was mainly a result of easing of COVID-19 containment measures that facilitated gradual resumption of economic activity

Nairobi Globe Roundabout

President Uhuru Kenyatta announced a Ksh 25 billion stimulus package for the revival of the pandemic-hit economy on Wednesday.

Kenyatta said the stimulus package complements ongoing State interventions that are expected to sustain the momentum of recovery, within the year’s growth rate projected to be 6 per cent.

With a positive uptake drive in vaccination and handling of the pandemic, President Kenyatta’s relief package targets sectors in agriculture, health, education, drought response, policy, infrastructure, financial inclusion and environmental conservation.

This is a build-up to the first and the second stimulus packages that were designed to ensure the Kenyan economy could endure the shocks occasioned by the coronavirus pandemic.

“With significant progress registered in the containment of COVID-19, it is now time to shift our focus from survival to co-existing with the disease. In that regard, my Administration will be rolling out the third financial stimulus programme, designed to accelerate the pace of our economic growth and to sustain the gains already made,” President Kenyatta during the Mashujaa Day celebrations in Kirinyaga County.

Agriculture Sector

Tea Sub-Sector: To safeguard the gains made in the Tea Sub-Sector, I direct the National Treasury to allocate KSh. 1 Billion in support of fertilizer subsidy for our small scale Tea Farmers.

Sugar Sub-Sector: To safeguard the livelihoods of farmers within our nation’s sugar belt, I direct the National Treasury to allocate an additional KSh. 1.5 Billion in aid of the sugar sector, that will be appropriated towards factories maintenance and payment of farmer’s arrears. 

Coffee Sub-Sector: In acknowledgement of the pace of the ongoing reforms on the sub-sector, I direct the National Treasury to allocate KSh. 1 Billion to the Ministry of Agriculture to be appropriated towards completion of the ongoing targeted interventions in the Coffee Sub-Sector.

Livestock sector: Noting the effects of the ongoing drought situation, I direct the National Treasury to allocate KSh. 1.5 Billion in support of the communities affected by the ongoing drought in especially in our ASAL counties as part of our National Livestock Offtake Programme. 

To secure a reduction in the prices of animal feeds, I order and direct the Cabinet Secretary for Agriculture, jointly with the National Treasury, to issue within seven days, a framework that will facilitate the reduction of the cost of animal and chicken feeds. 

Education Sector

Noting the success of my Administration’s policy on 100% transition from primary to secondary education, I direct the National Treasury to allocate KSh. 8 Billion to the Ministry of Education for the CBC Infrastructure Expansion Programme.

Health Sector 

To enhance access to medical coverage across our nation, and as part of our Universal Health Coverage programme, I direct the Ministry of Health will move with speed to establish an additional 50 New Level 3 Hospitals, to be situated in non-covered areas and densely populated areas across our nation. I further direct the National Treasury to allocate KSh. 3.2 Billion for immediate construction of these medical facilities. 

The eighth intervention is in the National Sanitation Programme: We started this programme to harness the energy of our young people and to give them a buffer against COVID-related unemployment. Noting the success of Kazi Mtaani Programme and its effect in enhancing opportunities for the youth across the country, I direct the National Treasury to allocate KSh. 10 billion for the third phase of the Kazi Mtaani Programme. The programme covering over 200,000 youths will be rolled out to all counties, with priority given to densely populated areas. 

Energy Sector

The ninth intervention is on energy and petroleum. Being fully aware of the positive strides being made in our economic recovery, the gains stand the risk of being eroded by high energy prices. To address the plight of our people, I order and direct that:

The Ministry of Petroleum & Mining, jointly with the National Treasury, shall develop by 24th December 2021, a framework for stabilization of petroleum prices, so as to cushion Kenyans against the turbulence caused by the current volatility in fuel prices; and 

The Ministry of Energy shall secure the full implementation of the Report of the Presidential Taskforce on Review of Power Purchase Agreements, that establishes a pathway for the reduction of electricity prices by 30 % by or before the 24th of December this year.