MPs approve plan to set up financial hub

Treasury Cabinet Secretary Henry Rotich. FILE PHOTO | NMG

What you need to know:

  • The Nairobi International Financial Centre, said the MPs, will create employment in the financial and related sectors such as information, communication technology (ICT), business process outsourcing and other professional services.

A House committee has approved the establishment of an international financial centre (IFC) in Nairobi meant to mobilise domestic, regional and international savings and investments to spur sustained growth in Kenya and the region.

The National Assembly’s Finance, Planning and Trade committee wants MPs to approve the Nairobi International Financial Centre (NIFC) Bill, 2017 saying it will help the country attract foreign direct investment.

“Having exhaustively considered the Bill, the committee noted that the NIFC seeks to connect the economy with global capital markets to enable domestic firms to access international capital pools and gain from global trade,” the Benjamin Lang’at-led committee said in a report tabled in Parliament on Wednesday.

The NIFC, said the MPs, will create employment in the financial and related sectors such as information, communication technology (ICT), business process outsourcing and other professional services.

The Bill also seeks to increase the competitiveness of the economy, principally through increased access to domestic, regional and international capital at lower costs, longer tenors and better terms, said the MPs.

Critics had questioned the powers bestowed on the Cabinet secretary responsible for the Treasury to decide what constitutes “business activity”, adding that the Bill limits the regulation in preventing economic crimes such as money laundering.

But the Treasury dismissed amendments brought by the East Africa Tax and Governance Network, Tax Justice Network Africa and Saadani Ali who argued that the NIFC is likely to turn Nairobi into a centre for illicit financial flows.

“The progress of making regulations requires public participation and parliamentary process... This will ensure activities carried out by the centre are above board, thus preventing economic crimes and Cabinet secretary cannot presume excessive power nor abuse the power to decide on which activities to be carried out under the centre,” said the Treasury Cabinet Secretary, Mr Henry Rotich.