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Old April 15th, 2019, 08:16 AM   #541
Snowlion
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Originally Posted by Dhuks View Post
Someone explain to me the Tanzanian situation. When Kikwete was leaving office, werent the GDP figures of both Kenya and Tanzania in the same range, what has brought the drastic difference now
If I recall correctly, there was credibility concerns that ware raised by IMF and others in relation to how Tanzania had/was collecting and reporting economic data. The models they had been using to calculate their economic activities was not what most other countries used or was expected in order to do proper comparisons

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Old April 15th, 2019, 03:31 PM   #542
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IMF tips Kenya economy to hit Sh10trn this year

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The size of Kenya’s economy is projected to reach the Sh10.1 trillion mark this year, the latest statistical estimates by the International Monetary Fund (IMF) have shown.

This will mark the largest absolute expansion in recent years, with the gross domestic product (GDP) estimated to rise by Sh1.1 trillion from Sh9 trillion in 2018.

In percentage terms, the growth this year is estimated at 5.83 percent, a slight decrease from 5.95 percent last year.

If the IMF projections hold out, Kenya’s economy could grow to Sh15.7 trillion in 2023.

The country expects to start commercial oil exports in 2022, a move that is expected to boost the GDP considerably.

A larger economy, coupled with strong growth in the coming years, means better prospects for expansion of jobs, labour earnings, investment opportunities and delivery of social services by the government.

Analysts say the government needs to entrench macroeconomic stability to maintain the growth momentum.

“We need low inflation, predictable interest rates and an environment of policy stability to attract private sector investment,” Robert Bunyi, an investment analyst, told the Business Daily.

Massive investments

Kenya’s current economic growth momentum is being fuelled by massive investments by the government and the private sector amid a favourable macroeconomic environment featuring low inflation and controlled interest rates.

The government continues to invest heavily in energy and infrastructure projects, including roads and the Standard Gauge Railway (SGR).

A substantial part of private sector investment is being channelled into real estate.

IMF’s growth estimates are based on the current market prices using exchange rates prevailing between January 14 to February 11.

They are also reliant on several assumptions, such as that established policies of national authorities will be maintained and that the average price of oil will be $59.16 a barrel in 2019 and $59.02 a barrel in 2020 and will remain unchanged in real terms over the next few years.

Dominant

Kenya’s economy is expected to remain dominant in the region, staying ahead of its rivals in terms of overall size and the welfare of the average citizen as expressed in GDP per capita.

Ethiopia’s GDP, which was previously tipped to overtake Kenya’s economy, is now projected to grow 7.7 per cent to $90.9 billion (Sh9 trillion) this year.

That of Uganda is expected to expand 6.2 per cent to $30.3 billion (Sh3 trillion).

Tanzania is estimated to register the lowest growth rate of 3.9 per cent to $61 billion (Sh6.1 trillion), interrupting its recent rapid expansion that has stood at more than six per cent per annum.
Note: That is an edited version. Please read the full article here
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Old April 15th, 2019, 03:36 PM   #543
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If they are projecting using oil revenues coming in by 2022 it makes sense.I wonder if they have started exporting the oil they had been storing in Mombasa.If the oil revenue is used well it could have great multiplier effect.What happened to Uganda oil?
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Old April 15th, 2019, 03:58 PM   #544
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I wonder if they have started exporting the oil they had been storing in Mombasa.If the oil revenue is used well it could have great multiplier effect.What happened to Uganda oil?
I thought they had started exporting the oil. I regularly see those trucks from Turkana passing through Eldoret so I assumed they had to be exporting it.
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Old April 15th, 2019, 04:27 PM   #545
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IMF tips Kenya economy to hit Sh10trn this year

Note: That is an edited version. Please read the full article here
This is great news. Two things:
1) I would rather count on Kenya's economy without oil exports from our mines. We are better off without that curse and what it brings. If it's going to bring divisions and wars, let it stay underground until such a time that we are ready. If it's going to be looted let it stay underground too, because it will cause social instability in our country, and the evidence is clear, we've attained this level of growth without that oil export/production. And if we tighten anticorruption belts and focus more on efficiency, we could attain much more growth.
2) The investment in infrastructure across the nation has ensured that money supply and access are improved over the recent years, which has excited investment opportunities to prosper. That investment should continue across the nation for us to maintain this growth longer.
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Old April 15th, 2019, 06:58 PM   #546
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I thought they had started exporting the oil. I regularly see those trucks from Turkana passing through Eldoret so I assumed they had to be exporting it.
They're storing it in Mombasa. Since it's still in the pilot phase. They're still looking for a buyer so we'll see.


Also if the government could cut taxes it would be a way of growing the economy faster and restart that engine once again.
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Old April 15th, 2019, 09:24 PM   #547
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Also if the government could cut taxes it would be a way of growing the economy faster and restart that engine once again.
This proposal is great and makes a lot of sense, except that the relationship between taxes and govt. revenue are intertwined or shall we say cyclical/simultaneous. Teasing out which taxes to cut can be really tough and that's what keeps the treasury and planning awake mostly, because taxes are the main source of govt. revenue and less revenue means less govt. investment and intervention in the economy, meaning less money supply in the market, less economic output, lower growth and the cycle repeats, it becomes a vicious cycle. The govt. is the number 1 buyer of goods and services in any market, and with lower cash collections that ability dissipates. To do it, the treasury and planning must look at overall effect on revenue (least impact on total) and least impact on the population masses (select niche sectors where there's potential to collect most revenue and affect the least number of people to maintain the overall total revenue or close enough without causing social instability.

On the other hand, cutting taxes as you posit, stimulates spending by the masses, which ignites production (thru increased demand), leading to more taxes too (thru sales), because more people get employed (increased labour demand) and pay taxes through their increased participation (buying goods and services) in the economic system. Economics has many similar simultaneous equation-type problems like this one. Balancing them can be hard, but it is possible (certain assumptions must hold as always in economics, because everything is dynamic in economics).
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