Ruto: This is why taming the runaway cost of living has been a challenge
President WIlliam Ruto addressing the nation from State House, Nairobi.
What you need to know:
- President Ruto said his government is breaking new ground and charting a new political culture for Kenya.
- The President further pointed out that consumption subsidies drove the nation into deeper financial distress.
President William Ruto says while the country has made encouraging progress across many sectors taming the rising cost of living remains a big challenge.
In his New Year message to Kenyans, Dr Ruto cited the impact of global economic dynamics that have adversely affected the country.
At the same time, President Ruto said the economic recovery has been compounded by the war in Europe, rising interest rates in America, and the unfortunate effects of climate change that occasioned the most severe drought in 40 years.
“All these factors slowed down our economic performance, resulting in increased commodity prices. Fertilisers and cereals experienced significant price hikes, contributing to the rise in food prices and the overall cost of living,” said the Head of State.
However, President Ruto assured Kenyans that his government is determined to stabilise the wobbling economic ship by putting austerity measures in place.
“To manage, moderate, and overcome these difficulties, this became the year of a complete paradigm shift in the handling of our national issues. We collectively summoned the courage to make bold, decisive, far-reaching, and long-term decisions to once and for all put our country on the path to attaining its full socio-economic potential,” said Dr Ruto.
“The choices we've made over the last year were neither easy, populist, nor convenient. They were however meaningful, appropriate, and necessary. On the short-term painful, but on the long-term gainful,” he added.
He cited the cutting of expenditure by up to Sh400 billion to reduce our borrowing as one of the measures his government has implemented so far.
At the same time, he said his government has enhanced tax revenues by Sh600 billion to fund development programmes and reduce foreign debt.
The President further pointed out that consumption subsidies drove the nation into deeper financial distress saying they were also “unsustainable, opaque and only benefited middlemen, at the expense of those who truly deserved support.”
He said to address such challenges in the future, his government redirected its focus to support production through incentives in our crops, livestock, and fisheries programmes.
“Today, with the blessing of good weather, these interventions have enabled us to increase our food production by 40 per cent, at a fraction of the previous cost. Working with farmers, our foremost patriots, we shall double our efforts in 2024, until we reduce our Sh500 billion food import bill to zero, and rid our country of the shame of hunger.”
While experts say that the country is slowly missing out on economic investment, President Ruto said Kenya has triumphed over the threat of economic stagnation.
“We are now in a secure space concerning our sovereign debt obligations. Inflation has reduced to 6.8 per cent and our GDP is growing at the rate of 5.4 per cent, placing Kenya as the 29th fastest-growing economy globally,” said Dr Ruto.
He said Nairobi is recognised as the best city to visit in 2024 by the US-based travel agency Lonely Planet, and Kenya stands as the 3rd highest recipient of remittances, according to the World Bank.
Additionally, President Ruto pointed out that the country holds the 3rd position as a globally attractive destination for foreign direct investment in 2024.
“Kenya has also achieved the status of the best adventure tourism destination in Africa and ranks 10th globally.”
He criticised the opposition saying its only purpose is division, conflict, and anarchy; and litigation, sponsored by hostage-taking vested interests, with the sole aim to delay, derail and sabotage the delivery of public programmes and defeating public interest.
President Ruto said his government is breaking new ground and charting a new political culture for Kenya.
“Instead of excuses to abandon our nation's transformation, I invite the skeptics, opponents, and the indifferent to change their perspective and embrace our new paradigm shift to pursue inclusive growth, with a sense of urgency, where leaders say what they mean and mean what they say,” said Dr Ruto.
