Tag: BUSINESS

  • President Ruto’s name dragged into the Lang’ata land dispute

    President Ruto’s name dragged into the Lang’ata land dispute

    Ruto’s name dragged into the Lang’ata land dispute following the 2007 post-election violence.

    According to a publication by Daily Nation, William Ruto’s name will feature today at the proceedings of a tribunal on a dispute involving public land in Lang’ata, Nairobi, on which families displaced following the 2007 post-election violence are settled.

    Advocates of 1,200 families accuse a local politician of selling plots on public land while using President Ruto’s name. 

    The families claim they moved onto the land in 2008 with the approval of then-President Mwai Kibaki.

    One of the orders they request from the National Environment Tribunal is to prevent Mr. Saja Muraya, a politician, and the director general of the National Environment Management Authority (NEMA), from bringing up the President in the legal battle.

    The internally displaced persons (IDPs) claim that although they have been occupying the land for 15 years, the same has been allocated to a private developer and they are facing imminent eviction.

    They have sued Nema and its director-general Mamo Bolu, the Registrar of Lands, the Attorney-General, Mr. Muraya, and the Nairobi City County government.

    In documents filed at the tribunal, the claimants allege that Mr. Muraya “states that he is selling the public land on behalf of President Ruto and that Mr. Bolu has authorized” the exercise.

    “He seems to be operating above the law, selling public land, blocking public roads, and charging citizens to access the same. He even states that he is selling the public land on behalf of His Excellency President William Samoei Ruto and that the 6th respondent (Bolu) has authorized, endorsed, and approved the same,” reads the documents. 

    “He even places his phone on loudspeaker where an individual claiming to be Mr. Bolu says that we should leave the land as the same has been sold and that it is the President himself, William Ruto, who has directed the sale,” further reads the documents.

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    “Mr. Muraya, who is a local politician, came to the applicants and demanded that they should give him half of the land for his personal development and he would offer them protection,” reads the documents.

    The land is near the Dam estate in Lang’ata. The claimants argue that apart from the land being public and riparian, it is also a way leave for Kenya Power. 

    “The applicants have been in occupation of the land with their grandparents, parents, and children. They have built homes on the suit property, which is located under the main national power grid of the Kenya Power and Lighting Company. 

    The said land is public land and has never had any title as it belongs to the government,” said the claimants. Led by Mr. Zablon Kibe, they add that the land houses a church, school, and residential houses and that the structures are 200 metres away from the Nairobi dam. 

    The claimants further allege that they have been furnished with title deeds for the said land, “which strangely have three different persons as owners”. They say that the intended sale of the land to private individuals is based on the said titles.

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  • Inside government plans to employ 3,000 Kenyans

    Inside government plans to employ 3,000 Kenyans

    Government plans to employ 3,000 Kenyans would be deployed to the Kenya Forest Services (KFS) to address forest fires.

    Soipan Tuya, the cabinet secretary for the environment, climate change, and forestry, disclosed plans to increase the number of her team by hiring 3,000 more workers.

    At a consultative conversation on March 1 at the Serena Hotel in Nairobi, Tuya confirmed that the 3,000 people would be assigned to the Kenya Forest Services (KFS).

    The CS claimed that recruits will aid the government in resolving the country’s forest fire crisis.

    Tuya added that the workers would aid the government in stepping up its surveillance in order to put out forest fires brought on by illicit activity.

    “Forest fire is attributable to illegal activities. That is why we, as the government we are enforcing enhancement methods and enhancing the number of forest officers in the Kenya Forest Service, where we will soon employ close to 3,000 forest officers,” Tuya revealed.

    At the same time, she disclosed that Mau Forest Conservancy was the hardest hit by the ravaging effects of the mysterious fires.

    According to a recent report by the Kenya Wildlife Service, the fire had destroyed over 1,000 acres of forest in Mau Forest.

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    The CS further indicated that Kenya Forest Officers and their KWS counterpart had also been deployed to tackle forest fires at Aberdare Forest.

    “The forest fires are raging, and it’s not just in Abardares; in fact, the Mau Forest Conservancy is the hardest hit,” Tuya stated.

    “We have been able to employ a multi-sectoral approach, we have trying our forces within our forest service and Kenya Wildlife Service, various NGOs and government agencies have also come on board,” she added.

    To encourage environment conservation, Tuya announced plans to award Kenyans certificates to appreciate their efforts.

    The Certificate of Green Conduct would help them secure certain services and be used for various job recommendations in the country.

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  • Ruto moves to bar all civil servants from running personal businesses

    Ruto moves to bar all civil servants from running personal businesses

    Ruto through a cabinet decision approves a bill to limit the involvement of civil servants in individual businesses. 

    According to a Cabinet dispatch on Tuesday, February 28, the proposed bill titled Conflict of Interest Bill, 2023, will help prevent “real, apparent, or potential conflict between the private interests” and discharge of their official duties. 

    President Ruto and his cabinet members affirmed that the bill was part of their commitment to promoting good governance and national ethos. 

    “The Bill seeks to provide a framework for the management of conflict of interest on the part of State and Public Officers arising from the discharge of their official duties,” the statement read in part. 

    After becoming law, the Bill will offer a framework for handling potential conflicts of interest that could prevent government officials from fully focusing on their mandate, which, in accordance with the resolutions, has resulted in instances where public officials have neglected their duties in favor of private interests.

    Also, Cabinet reviewed a prior Cabinet decision from 1971 that adopted the Ndegwa Commission Report and gave public employees virtually unfettered freedom to pursue personal interests and do business.

    “The bill will herald a new dawn in the management of public affairs by introducing strong legal safeguards against the real, apparent, or potential conflict between the private interests of public servants on one hand and the public interest and their official duties,” the document read. 

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    The bill will be forwarded to Parliament for consideration subject to the process laid down in the constitution. 

    Concerns about public officers engaging in personal businesses at the expense of service delivery have been raised in the past.

    Cases of government officials pursuing and influencing the award of tenders using their capacities have also been in the spotlight before in what was seen as a leading avenue to corruption. 

    In 2019, the cabinet of former President Uhuru Kenyatta proposed a bill that would see public servants declare their wealth including rental income, business income, farming income, and investment dividends. 

    The bill was conceived as part of the government’s efforts to curtail cases of corruption and embezzlement mainly through conflicting interests. 

    All cabinet secretaries and public officials would, according to the proposal, submit a declaration to the Ethics and Anti-Corruption Commission (EACC) for reference purposes. 

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  • Ruto’s cabinet replaces the KSh10trn debt ceiling with the percentage of GDP

    Ruto’s cabinet replaces the KSh10trn debt ceiling with the percentage of GDP

    Ruto’s cabinet ditches the KSh10trn debt ceiling with the percentage of GDP; Gross Domestic Product.

    In accordance with a pledge given to the International Monetary Fund (IMF) by the previous administration, President William Ruto tried to replace the Sh10 trillion public debt cap with a debt anchor as a percentage of gross domestic product (GDP), but the House rejected it.

    The National Assembly received approval from the Cabinet on Tuesday to change the debt ceiling from the current cap of Sh10 trillion to a new debt anchor set at 55% of GDP in present value terms.

    Since that Kenya’s debt is over 70% of GDP, the new ceiling indicates that the government is already in violation, and the incoming administration will now be compelled to find ways to drag the country backward by expanding the economy and easing the restraints on new loans.

    Although Kenya has not yet disclosed its 2022 GDP estimates, based on those from 2021, the nation’s total public debt should be Sh6.6 trillion to comply with the new metric.

    Kenya, however, previously exceeded the Sh9 trillion threshold in December, exceeding the new cap by a significant margin.

    With a debt anchor, Kenya’s debt limit will now become a moving target from an absolute figure with the present value of debt as a percentage of GDP expected to represent the current debt value in contrast to the current value of future cash flows.

    In a Cabinet memo on Tuesday, the government argues the shift to the debt anchor aligns with global standards and that it ensures the sustainability of Kenya’s debt stock.

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    “In keeping with the global best practice on the debt limit policy, and in furtherance of the administration quest to realize inter-generational equity through sustainable debt management, Cabinet considered the legislative proposal to harmonize the definition of public debt and the attendant regulations,” the Cabinet stated in part.

    The new push to adjust the debt ceiling also comes in less than a year since the nominal debt ceiling was pushed from Sh9 trillion to Sh10 trillion last June in what was interpreted as an interim measure to accommodate the deficit financing to the 2022/23 budget to June this year.

    Additional data from the Treasury’s 2023 Budget Policy Statement shows the size of public debt was on course to surpass the Sh10 trillion debt limit by June next year at Sh10.133 trillion.

    Former Treasury Cabinet secretary Ukur Yatani had promised to replace the debt ceiling with a percentage measure but this was rejected by the then parliament, instead choosing to increase the ceiling to Sh10 trillion.

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  • Chinese Govt responds after protests over China Square

    Chinese Govt responds after protests over China Square

    Chinese Govt official responds to China Square controversy after protests calling for tolerance and non-discriminatory.

    Wu Peng, Director-General of the Chinese Foreign Ministry’s Department of African Affairs, urged tolerance and the establishment of an inclusive business environment for both Kenya and China.

    The envoy stated in a statement dated February 28 that entrepreneurs should be given a warm welcome to open their enterprises in both countries as it would increase trade.

    He opined that Kenya was one of their biggest trade partners adding that they would continue fostering trade relationships between the two countries.

    Peng was responding to the controversy around China Square, which is owned by Chinese national Lei Cheng.

    “A non-arbitrary and non-discriminatory investment environment is vital to the healthy development of bilateral practical cooperation.

    “I believe that through collective efforts, China-Kenya cooperation will better benefit both people,” read the statement in part.

    On the other hand, he noted that China was open to foreign investors even as he stated that a number of chain stores were run by non-residents.

    The special envoy added that Kenya had also benefitted from some of the Chinese-run companies that set shop in Kenyan in recent years.

    “Our commitment will translate into more favourable policies for foreign investors. International supermarkets, chain-stores can be seen everywhere in China and we welcome more to come.

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    “Brotherly bonds and fruitful outcomes are cornerstones of China-Kenya cooperation. The slogan of a famous Chinese ceramics factory in Kenya – Twyford tile is ‘Buy Local, Build Local’,” he added.

    Peng’s response came amidst controversy over China Square which has seen its owner close the business temporarily.

    The mall-based at Unicity – owned by Kenyatta University closed after Trade Cabinet Secretary Moses Kuria opined that the enterprise needed to be leased out to local traders to boost products made in the country.

    Following his statements, traders based in Gikomba and Nyamakima took to the streets to demand the closure of the mall as they alleged favoritism towards businesses owned by non-residents.

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  • Ruto lifts Uhuru’s ban on independent power producers (IPPs)

    Ruto lifts Uhuru’s ban on independent power producers (IPPs)

    Ruto through a cabinet declaration lifts Uhuru’s ban on the procurement of new independent power producers (IPPs).

    In an effort to boost electricity production at a time when annual droughts are getting more severe and limiting hydropower generation, the Cabinet has relaxed the Uhuru-era ban on the acquisition of new independent power producers (IPPs).

    The task force established by former president Uhuru Kenyatta in March 2021 to evaluate power purchase agreements (PPAs) and presented a report in September of that same year put a freeze on the selection of new IPPs.

    Since then, Kenya Power has not signed any new PPA with any IPP in a period of just over a year in line with the task force’s report.

    Ruto through a cabinet decision has, however, lifted the moratorium which now allows energy investors to come and sign contracts with the utility for the supply of electricity.

    The Cabinet claims that the action was required by the severe drought, which has lowered the hydroelectric power output from the major dams and allowed additional IPPS to enter the country and establish themselves in order to protect the nation from power supply disruptions during upcoming droughts.

    According to Kenya Power, the 200 megawatts (MW) of power imported from Ethiopia since January have made a substantial contribution to closing the gap left by the drought-related shortage in local hydropower generation.

    “In addressing the challenges of realizing a sustainable energy mix occasioned by the prolonged drought, Cabinet approved the lifting of the moratorium on PPAs as a way of enhancing the nation’s energy security through opening up the energy sector for continued investments,” said Cabinet.

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    Any new IPP that comes on board will join some 5 new power producers that have connected to the grid over the past five years which has increased the country’s generation capacity.

    Kenya Power says Kenya’s reserve margin – the amount of unused available power generation capability – is at just 4 percent and therefore onboarding new power generators to the grid is necessary.

    The Cabinet has also approved a framework for the engagement of these IPPs with energy auctions as opposed to the current feed-in tariffs regime.

    In the new energy auction system however, the IPPs will be bidding for the supply of power to the grid where the lowest bidder will win the right to supply energy to the grid during that cycle.

    “The new framework will enable the State to procure clean energy at prices that reflect those prevailing in the market, giving consumers the benefit of competition in pricing,” said the Cabinet.

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  • IMF backs Ruto’s plan to raise taxes

    IMF backs Ruto’s plan to raise taxes

    IMF backs Ruto’s fiscal consolidation plan to raise taxes and target cheating in a bid to increase government revenue.

    The International Monetary Fund (IMF) has approved Kenyan President William Ruto’s proposal to increase revenue, which calls for raising taxes, going after cheaters, and broadening the tax base—despite its concerns about the high cost of living in the nation.

    Tobias Rasmussen, the IMF’s resident representative in Kenya, claimed that rising prices for necessities impacted people all around the world and urged that Kenya should provide relief to those who are most in need while limiting the budget deficit.

    “This calls for increased revenue mobilization and targeted interventions, such as cash transfers to the poor. The IMF-supported programme in Kenya places a strong emphasis on these areas,” Rasmussen said.

    Kenya targets tax revenues above 17.8 percent of GDP in 2023/2024 and above 18 percent of GDP over the medium term.

    As part of his economic turnaround plan, Ruto has set its eyes on a Ksh3 trillion ($24 billion) revenue collection by the Kenya Revenue Authority (KRA) in the 2023/2024 fiscal year and Ksh4 trillion over the medium term through tax administrative and policy reforms.

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    These include expansion of the tax base by bringing in the informal sector – which has an estimated potential of Ksh2.8 trillion ($22.4 billion) – and taxing rental properties, according to the Kenyan Government Budget Policy Statement of 2023.

    The Kenyan National Treasury has also proposed to integrate the KRA tax system with telecommunication companies to monitor mobile money transactions on a real-time basis following concerns of possible under-declaration on transactions.

    Other measures are for Customs and Border Control to leverage on technology and enhanced data analytics.

    Last year, Ruto revived a proposal to impose higher taxes on Kenya’s super-rich and high-income earners.

    “The IMF has welcomed the new administration’s firm stance on reducing debt risks, backed by strong actions to preserve fiscal discipline in a difficult environment,” Rasmussen said in a statement.

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  • US announces Ksh 16B aid to Kenya after Jill Biden highlighted Kenya’s drought

    US announces Ksh 16B aid to Kenya after Jill Biden highlighted Kenya’s drought

    US announces Ksh 16B in food aid to Kenya after Jill Biden highlighted Kenya’s drought comparing it to war in Ukraine.

    The United States announced Ksh16 billion in help for Kenyans suffering from a protracted drought and hunger through the United States Agency for International Development (USAID).

    Jill Biden, the first lady, has brought attention to the situation of those living in regions affected by drought, claiming that the catastrophe had terrible effects on them.

    “As our world has become more connected, we have seen how hunger and violence, poverty, and natural disasters, are not contained by borders.

    “Our futures are woven together — and we must all come together to continue to help fight the effects of this historic drought,” Jill Biden pleaded on Sunday, February 26. 

    Responding to the grievances she raised, USAID administrator, Samantha Powell, on Monday, February 27, noted that the agency would advance Ksh16 billion to Kenya. 

    “Rainfall in Kenya is now less than 70 percent of the 30-year average across most of the country.

    “This severe drought has caused a dire hunger crisis, and USAID announces Ksh16 billion in additional food assistance,” Powell detailed.

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    USAID stated that the donation will help 1.3 million Kenyans suffering from drought.

    President William Ruto thanked USAID profusely for helping Kenya, remarking that the money would go a long way towards helping suffering Kenyans. 

    “On behalf of the people of Kenya, my profound gratitude to the US government for this generous support.

    “The money will go to very deserving people suffering the worst drought due to four consecutive years of failed rains,” the President stated.

    According to the Head of State, some of the money will be channeled toward water harvesting to enhance food and livestock production as well as manage climate change effects.

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  • Kenya Power records Ksh1 billion half-year loss

    Kenya Power records Ksh1 billion half-year loss

    Kenya Power records a Ksh1 billion half-year loss owing to a 15 percent power tariff implemented by the previous administration.

    Owing to a 15% reduction in power prices that was enacted in January of last year and a depreciating shilling, Kenya Power has suffered a net loss of Sh1.14 billion for the six-month period ending in December 2022.

    This is a sharp drop from the Sh3.8 billion net profit recorded during the same period in 2021.

    “This drop is attributable to increased foreign exchange losses and the implementation of the 15 percent reduction of the end user electricity tariff as recommended by the government in January 2022,” said Kenya Power in a statement on Monday.

    The utility company’s costs were dramatically raised as a result of the price decrease, which was intended to lower the price of energy, and a weak shilling, which caused it to enter the red for the first time since 2020.

    To reduce the cost of living, former president Uhuru Kenyatta introduced the tariff reduction in January of last year.

    Despite an increase in sales, Kenya Power’s basic electricity revenue for the six-month period decreased by Sh6.69 billion due to the 15% fall in power pricing.

    Kenya Power recorded a 4.4 percent growth in electricity sales during the period to 4,764 gigawatt-hours (GWh) attributed to growing demand occasioned by increased economic activities and an expanded customer base. 

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    The weakening shilling has also increased its costs of repaying its debts as well as payments of power supplies from power producers. 

    This saw its operating costs rise to Sh21.72 billion from Sh19 billion in the six months to December 2021 while fuel costs rose to Sh15.08 billion from Sh10.87 billion owing to higher fuel prices during the period. 

    Kenya Power’s management, however, maintains a positive outlook for the second half of the year and has earmarked growth of sales to return it to a profit-making position. 

    “The company projects to improve its business performance in the second half of the financial year by retaining the unwavering focus on increasing electricity sales, enhancing system efficiency, and prudently managing its resources,” said the company. 

    The company had sunk into a net loss of Sh2.98 billion in the full financial year that ended June 2020, which was its first net loss in 17 years but had since wriggled its way back into profitability. 

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  • COB report exposes Six Governors for overshooting county current expenditure by over 750 percent

    COB report exposes Six Governors for overshooting county current expenditure by over 750 percent

    COB report exposes Six Governors for overshooting county current expenditure by over 750 percent with allocation on development.

    According to the latest report, all the governors violated the law that requires a minimum of 30 percent of the county government’s budget to be allocated to development expenditures.

    While some continue to spend lavishly on consumption, they have very little money set aside for growth.

    In other counties, the ratio has blown out to Sh100. 

    Ideally, spending on recurrent items like salaries and allowances should not exceed Sh2.33 for every Sh1 allocated for development.

    According to the most recent report by the Controller of Budget (COB), while no county met the legal requirement to allocate at least 30% of resources to development over the course of seven months to the end of January 2023, nearly half flagrantly violated the requirement, sometimes by as much as 4,000%.

    The report shows that Governor Simba Arati of Kisii, who has been loud in his efforts to weed out ghost workers from the county since being sworn in, is spending the least on development.

    The COB report shows that over the six months, he has been in office, for each shilling he requested to channel to the county’s development projects, he requested Sh93 to use on recurrent activities, mainly on salaries and allowances.

    Since being sworn in as the governor on August 25, 2022, until January 31, 2023, Mr. Arati requested Sh3.3 billion to fund its recurrent budget and only Sh35.3 million for development. 

    He overshot on recurrent expenditure by 3,886 percent as compared to spending on development.

    Meru County Governor Kawira Mwangaza over the six troubled months she has been in office channeled over 98 percent of resources to salaries and allowances, with the county’s development programmes left with a paltry 1.8 percent.

    The governor requested Sh3.77 billion for recurrent activities, but only Sh70 million for development, with salaries and O&Ms forming 52 of the 59 money requests the county made to fund its recurrent budget.

     Lamu also followed with huge allocations on the recurrent budget.

    While the county received Sh1.39 billion for spending on recurrent activities, only Sh35.8 million was received for development. 

    This means that for every Sh1 that went into development for Lamu residents, Governor Issa Timamy spent Sh38.7 on salaries, allowances, and other recurrent spending. The development budget’s share was a mere 2.5 percent.

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    In Machakos and Migori, for every shilling the counties received to fund development activities, it received at least Sh22 to channel to recurrent activities. 

    The counties are headed by governors Wavinya Ndeti (Machakos) and Ochilo Ayacko (Migori).

    Governor Susan Kihika of Nakuru for every Sh1 spent on development, Sh20.8 went into recurrent activities.

     All the above six counties, which overshot spending on recurrent by over 750 percent, are headed by newly elected governors, with Mr. Timamy the only one who has served in the post before — between 2013 and 2017.

    The other counties in the top 10, according to the COB report, also spent beyond the allowable Sh2.33 on recurrent for every shilling put into development, spending between Sh12 and Sh20, in total breach of the law.

    They are Kiambu whose governor is Kimani Wamatangi (Sh19.9), Kitui whose governor is Julius Malombe (Sh19), Bungoma whose governor Ken Lusaka was Senate speaker until the 2022 elections and also served as governor of the county between 2013 and 2017 (Sh18) and Makueni County of Mutula Kilonzo Jr (Sh17).

    The priorities exhibited by the governors on resource allocation position them as leaders interested in promoting consumption, rather than development for their residents. 

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