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BUSINESS
KAM, Kenya Power move to drive down cost of electricity WEEKEND EDITION, FEBRUARY 17-19, 2017
The Kenya Association of Manufacturers (KAM) has partnered with utility firm, Kenya Power with a view to improve customer interaction and engagement. The two organisations are looking to improve service delivery within the power sector. Kenya Association of Manufactures Chairperson, Flora Mutahi Mutahi says power interruptions have been a major issue in the country. Speaking on Thursday during an engagement meeting with Kenya Power officials, she noted that KAM would increase its efforts to support the industry. The manufacturing sector accounts for 60 per cent of the utility’s revenue. On his part, Acting Kenya Power CEO Dr. Ken Tarus, said the company has invested appropriately in improving the quality and reliability of electricity supply to industries. “Some of the platforms the two organisations are using to foster relations include a Whatsapp group. We have set up a unit to serve and listen to concerns. You are at the center of our business,” he explained. New Ag. MD & CEO Dr. Ken Tarus sharing his vision with the Manufacturing industry “We will do real time monitoring of your consumption for accurate billing,” said Kenya Power General Manager for Business Strategy Eng Peter Mungai. Eng Mungai noted that there have been issues regarding power quality in the recent past. “We want to improve. We started with Boresha Stima Viwandani Project,” he added, referring to an operation through which the company intends to improve the quality of power supply to its large power and domestic customers within the Industrial Area, Nairobi. Speaking during the official launch of the drive in 2014, Kenya Power’s Regional Manager, Nairobi South, Eng. Joshua Mwangi, said that the operation will greatly complement
Kenya Power General Manager for Business Strategy Eng Peter Mungai speaks during the event. the efforts that the power firm has put towards reducing power interruptions for its large power and essential service customers. Eng. Mwangi said that the operation will involve the refurbishment of ten substations namely NSSF, Nairobi South, Nairobi West, Mombasa Road, New Airport, Syokimau, and New Industrial,Athi River,Jogoo Road,and Dara. “We want to focus on improving infrastrature, enhance network to ensure quality supply,” End Tarus said.
“We are trying to contribute 15 per cent of the GDP. We cannot do that without reliable power supply,” Mutahi argued. On her part, KAM CEO Phyllis Wakiaga said Kenya is making a shift to renewable energy. “It is a positive move to preserve the environment,” she explained. “We promise to work together to ensure price is coming down,” Eng Mungai said. Tarus also says Kenya Power has introduced Automatic Metering
Reading Systems (AMR) and Smart Meters for commercial customers which ensures there is real-time monitoring of consumption resulting in accurate billing. The Company adopted new procurement guidelines that will see it source for 80 per cent of its supplies from the local market including transformers and meters. “Power is a huge catalyst in creation of jobs,” Mutahi said. @enock_x254
External, domestic borrowing to help government lower budget deficit in 2017/18 financial year
The National Treasury is targeting a fiscal deficit of 7 per cent of GDP in its financial year starting in July, down from 9.6 per cent this fiscal year, the government body said in a draft budget. The draft projects the deficit at Sh582.5 billion, down from an estimated Sh716.9 billion this fiscal year. The Treasury said the deficit would be covered by Sh206 billion net external borrowing while the rest will come from domestic borrowing. The government was committed to lowering the fiscal deficit to 5.2 per cent of GDP in the 2018/19 fiscal year and 4 per cent in the medium term,
the Finance Ministry said. “This reduction will strengthen our debt sustainability position,” the Ministry said. The state body added that economic growth was expected at 5.9 per cent this year from an estimated 6 per cent last year. Opposition leaders and market analysts have criticized the government for its exuberant borrowing, asking for an overhaul of current financial policies. “The Government cannot continue with its bullish way of infrastructural development when it cannot raise money internally,” Suna East Member of Parliament Junet Mohammed said
in a recent address. “You cannot borrow to pay a debt. You can only repay debts by raising money internally. They must stop digging deeper in the hole of debt they are already in. But I can tell Kenyans that solution to this economic abyss will only be fixed by the next government to be formed by the Opposition. We are facing a total foreign debt of Sh4 trillion as a country and we have a budget deficit of Sh900 billion, which is not sustainable. You cannot have an economy that has a revenue of Sh1.2 trillion with such huge debt portfolio,” Mohammed added. In December last year, Treasury
Cabinet Secretary Henry Rotich said that the country planned to raise $1.5 billion (over Sh155 billion) by the end of this financial year in June from the commercial market. The money is expected to ease budgetary pressures exerted by the general election in August, ongoing infrastructure projects as well as food imports and other drought mitigation efforts, in the face of underperformance in tax collections. A budget deficit is an indicator of financial health in which expenditures exceed revenue.
Kenyans living abroad send home Sh14.8bn Remittances sent home by Kenyans living and working abroad increased to $142.6 million last October, up 3.9 per cent year on year, the Central Bank of Kenya has confirmed. Making the announcement earlier this morning, the regulator noting that remittances made up 2.5 per cent of Kenya’s GDP in the year to October. The funds are a key source of hard currency and are tracked by traders. A remittance is money sent by a person in a foreign land to his or her home country. Due to the huge sums involved, remittances are now being recognised as an important contributor to the country’s growth and development. The Central Bank of Kenya conducts a survey on remittance inflows every month through formal channels that include commercial banks and other authorised international remittances service providers in Kenya. Remittances boost economic development at a national level, helping reduce poverty, promote national development, empower communities and promote access to productive resources. A 2015 World Bank report and an analysis from the Ecofin Agency published in the same year showed that one in seven Africans (about 120 million) receive remittances from relatives, friends and families abroad. Remittance income enables recipients to engage in subsistence agriculture and other investment opportunities that directly alleviate poverty while improving the livelihoods of people. In Kenya, investments such as land and property purchases, and farm improvements account for more than half of the spending. In Senegal more than half of remittance money received is spent on food, education, and healthcare. These developments come just as it has emerged that US President Donald Trump’s protectionist economic policies will pose the biggest risk to Kenya’s economy in the coming year. This is according to Central Bank of Kenya Governor, Patrick Njoroge. Trump’s immigration policy exposed millions of undocumented immigrants, including over 30,000 Kenyans, to the risk of deportation is seen to pose a major threat to the flow of diaspora remittances, Remitances were the biggest source of foreign inflows into Kenya last year, ahead of tea and tourism. They accounted for more than Sh176 billion in foreign inflows last year alone. @Dennis_x254