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Kenya raises 2016/2017 budget deficit forecast to $6.9 billion

Kenya raises 2016/2017 budget deficit forecast to $6.9 billion

Kenya

Kenya’s budget deficit for the fiscal year 2016/2017 is likely to be more than 9 percent of gross domestic product (GDP), based on a forecast given by the country’s finance minister

Finance Minister, Henry Rotich, said in a budget speech the deficit would be $6.9 billion a figure equivalent to 9.3 percent of Kenya’s GDP.

In its April statement, the finance ministry said the actual deficit in the 2016 fiscal year would probably be around 6.9 percent of GDP, because ministries often struggle to spend their allocations.

The government has however maintained that Kenya’s public debt “remains sustainable”, with the net present value of public debt to GDP below 50 percent and posing a “low risk of debt distress.”

According to the budget estimates released by the Treasury Cabinet on Wednesday, Kenya is set to invest heavily in the security sector, with special focus on improving welfare, mobilisation and modernisation of the security forces in the country.

The statement released also outlined measures to boost revenue collection, including the potential introduction of a presumptive tax for those in the informal sector, who usually fall under the radar of the revenue authority.

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