Sh13bn to stimulate economy

The government is set to release a further Sh13 billion for various projects to jump-start the economy under the six-month-old stimulus package.

So far, it has disbursed Sh3.25 billion out of Sh24.2 billion set aside for projects in the 210 constituencies.

The money to be released before the end of the month is for the construction of schools, horticultural markets, jua kali sheds and public health centres.

The government hopes this will spur spending, especially in rural areas as away of getting the economy sizzling again.

Briefing journalists, at a Nairobi hotel on Thursday, Finance Minister Uhuru Kenyatta said more than Sh17 billion would have been released before the end of the current financial year.

Mr Kenyatta, who was accompanied by some Cabinet colleagues, however, said implementation of the Sh24.2 billion programme, which was expected to end in December last year, was delayed due to logistical problems.

“The development of an implementation framework took longer than expected due to consultation with relevant stakeholders, which partly contributed to the delay in kick-starting implementation of the Economic Stimulus Package,” he said.

He added that the selection of projects had to be carefully done to ensure that those chosen would have a positive impact on the targeted population.

The economic stimulus package, also known as ESP, was launched in July 2009 to spur economic growth, which had almost stalled, due to bad weather, the after-effects of the 2008 post-election violence and the global economic recession.

The first two impacted negatively on the country’s agriculture-dependent economy, resulting in a decline in food production.

Mr Kenyatta said tenders had already been awarded for the construction of public health centres, horticultural markets and jua kali sheds in 170 constituencies, which he added, will cost the treasury about Sh5.6 billion.

He also announced that the government was considering inclusion of the ESP in the next financial year, 2010/2011.

“Since the programme’s aim is to spur economic growth through fiscal decentralisation and equity in resource distribution, the government is considering including it in the next budget,” Mr Kenyatta added.