Saudi-based Kenyan Economist Mohamed Wehliye (pictured) has warned about tough economic times going forwards and suggested ways to correct the mistakes of the Jubilee regime.
The advisor to the Saudi Arabia Monetary Authority (Sama) wrote on his social media pages that among other things, President Uhuru Kenyatta needs to abandon the Big Four agenda, ease monetary policy, fight corruption truly, and undertake a major debt rearrangement program.
1. We face serious economic issues in 2020. It is no rocket science. All the numbers point to an unfolding debt nightmare. We need more strategic approach to macro-economic policy instead of piecemeal knee-jerk tactical interventions if we are to save the country.
2. Unless we put breaks to spending & turn the economy around quickly, there will be a downward spiral feeding on itself — an internal fiscal & financial sector crisis. Slower growth would also deepen an already worsening fiscal crisis.
3. Piecemeal reform is like a game of snakes and ladders — you go up one small ladder, and get bitten by a snake tumbling back to where you were. We need comprehensive bold reforms to catch the big ladder and on to the golden turnpike.
President Kenyatta needs to;
A. Abandon Big 4 mantra. It has become an excuse to not commit to fiscal consolidation
B. Immediately freeze new & yet to commence mega projects including rationalization of the same
C. Embark on an economic stimulus program supported by tax reforms
D. Reign-in on Infrastructure the Ministry – A junkie of debt.
E. Sustain the anti-corruption drive – A re-lapse can be catastrophic.
F. Undertake a major borrowing/debt re-arrangement program. This can yield significant savings & fiscal space that should not be misused.
G. Ease monetary policy stance but keep an eye on prices – Interest & FX rates
H. Get into an IMF program for traction of credible economic & financial reforms
Appoint CS Treasury & a credible team in Cabinet to turn-around the economy for posterity sake but not as a legacy for the appointing authority. 24 months cannot deliver the latter. Remember the final year is election campaigns. Or has it started already?
The administration chose to ignore bad news about the economy/debt for far too long & pretended that we were well on our way to Canaan. But the admin was fooling no one but itself. It is time to save the country & the economy from a total collapse & from an international bailout!
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