What's Inside

• Kenyans Protest Finance Bill 2024

• East Africa’s Budget Plans

• Don't forget to attend these events...

  • Headlines you might have missed

• Interview of the Week

Kenyans Protest Finance Bill 2024

This week, the controversial Finance Bill 2024, which seeks to raise revenues with new tax proposals that will raise the cost of goods and services, will come up for debate in Parliament amidst growing protests.

• The bill’s proposals to raise tax revenues have triggered protests across sectors, as it would raise the cost of goods and services significantly and eat into already thinning margins for households and enterprises. 

• The first step are recommendations from the Finance Committee, which has been holding public participation that has seen multiple submissions from sectors, experts, and even religious organisations.

• Kenya is in the middle of IMF-mandated structural adjustments, which include austerity measures and widening the tax base. 

One general concern has been that the tax measures will gut sectors, cost jobs, and eventually result in the same thing that it’s trying to solve. 

While the Executive has committed to IMF’s conditions, Parliament’s role is the last step in the budget making process where its still possible to make changes. Last week, Kenyans reached out to MPs directly and crowdsourced contacts online, as it became clear that the bill was likely to pass despite its unpopularity. The protests will move to the streets this week, as activists and other citizens rally under the #OccupyParliament and #RejectFinanceBill2024.

East Africa’s Budget Plans

On Thursday 13th June 2024, Finance Ministers of East African countries presented their 2024/25 budget statements to their respective parliaments, each with views tailored for their countries.

 Across the EAC nations, efforts towards debt sustainability lingered with all grappling with growing sovereign debts amid global economic risks.

Uganda

In Uganda, the Finance Minister, Matia Kasaija presented the UGX 72.13trillion ($19.2 billion) for the 2024/2025 fiscal year with an increase of UGX 19.39 trillion from UGX 52.74trillion of 2023/24 financial year. The anchor sectors tackled were Agriculture, ICT and Manufacturing.

• Total expenditure in the FY2024/25 budget is projected at UGX 72.136 trillion.

• Recurrent expenditure will amount to UGX 18.9 trillion while development expenditure at UGX 34.7 trillion. 

• Uganda’s GDP is projected to grow by 6.4 per cent in the next financial year, expanding to UGX 225.5 trillion.

This  surpasses Sub-Saharan Africa’s average of 3.8 percent and the global average of 2.9 per cent.

The growth, Matia said, will be driven by increased oil and gas activities, export growth, tourism development, agro-industrialisation and science, technology and innovation.

Education, health and water, sanitation and hygiene have been allocated UGX 10.204 trillion in the next financial year.

Additional financing is projected from grants and loans amounting to Shs1.3 trillion, domestic borrowing targeted at UGX 8.9 trillion. Further,  the framework also includes UGX 9.5 trillion from project support and UGX 19.8 trillion earmarked for domestic debt refinancing.

Tanzania 

Tanzania's budget is expected to rise by 11.2% to TZs 49.35 trillion ($18.90 billion) in the next financial year starting  July 2024, largely aimed at helping the government service its debts.

• The government projects total revenue collection, to be TZs 34.61 trillion, equivalent to 70.1 percent of GDP.

• Additionally, the government will raise  TZs 5.13 trillion from grants and concessional loans. 

• Total expenditure in the FY2024/25 budget is projected at TZs 33.55 trillion with recurrent and development expenditures amounting to TZs15.78 trillion.

“The budget has increased largely due to the need to service government debts that have been raised due to shilling depreciation, increase in interest rates and maturity of the previous debts, ” Finance minister Mwigulu Nchemba said on Thursday in the capital Dodoma.

Tanzania's economy is expected to grow 5.4 per cent in 2024, with the government keen on tax payment. 

Dr Nchemba said a bulk of the public cash in the next financial year will be injected towards strategic infrastructure projects, social services and preparations for 2024 local government elections and the 2025 general election.

Additionally, money was allocated for renovation of stadiums and construction of new ones as the nation prepares to co-host the 2027 Africa Cup of Nations (AFCON).

Rwanda

In Rwanda,The Government unveiled a proposal for a budget of Frw 5,690.1 billion ($4.3 billion) for the upcoming fiscal year 2024/2025, an increase of 11.2% from the previous budget.

Total estimated resources for the fiscal year 2024/25 are projected at Frw 5,690.1 billion.

• This comprises domestic revenues of Frw 3,414.4 billion, with Frw 2,970.4 billion expected from tax revenues and Frw 444.0 billion from other revenues.

• External grants are estimated at Frw 725.3 billion, while external loans are projected to amount to Frw 1,318.1 billion.

• Domestic borrowing and financial assets drawdown will total Frw 232.3 billion.

Burundi

Burundi's budget will rise 15.9% to 4.4 trillion Burundi francs ($1.5 billion) in the 2024/25 financial year starting in July with the government unfreezing of civil servants' salary bonuses, Finance Minister Audace Niyonzima said on Thursday.

"The priority allocations retained in this draft budget, which are at the origin of the budget increase, include particularly salaries and bonuses which have increased significantly," Niyonzima said.

 The economy is expected to grow 5.4%, up from 4.2% in 2023/24, boosted by government investment programmes and improved cooperation with the country's development partners.

Don't forget to attend these events...

Headlines you might have missed

Interview of the Week

Have a great week!