Treasury CS Njuguna Ndung'u announces Kenya's economic outlook for 2023

During the public hearings of the budget-making process, CS Ndung'u called for austerity measures in government ministries, including suspending on any new development projects.

He forecasted that the country's financial crisis was likely to rise to unimaginable levels.

"The outlook for 2023 is not looking very good. There are clear signals that it is going to be a tough year. The global economy is one good example of where we are heading," he said.

Treasury CS Njuguna Ndungu and Treasury PS Chris Kiptoo during the launch of public hearing for the budget making process Pulse Live Kenya

The CS stated that low-income countries have been hit hard by supply disruptions, debt, surges in food and commodity prices, and the devastating effects of climate change.

He added that according to the latest forecast from the International Monetary Fund (IMF), global GDP growth is likely to slow from 3.2% in 2022 to 2.7% in 2023.

However, he explained that the government's bottom-up economic policy would grow the local economy by 5%.

Professor Ndung'u said that the emphasis would be on aggressive revenue mobilization, including policy measures to raise additional revenue and reduce the impact of rising debt on Kenya's economy.

National Assembly Budget and Appropriations Committee Chairman Ndindi Nyoro stated that, despite global inflation, the cost of living in Kenya was compounded by the scarcity of food and resources.

National Assembly Budget and Appropriations Committee Chairman Ndindi Nyoro speaking public hearings of the budget-making process at KICC Pulse Live Kenya

He reiterated that the country should not continue the borrowing spree for recurrent expenditure or compare Kenya's economy to other heavily indebted countries such as Japan and the US, whose debt-to-GDP ratios are over 100%.

"We cannot continue to perpetuate borrowing by referencing countries that borrow and are doing well," he said.

The tough year will further be compounded by the decision by President William Ruto to end fuel, unga and electricity subsidies that had been put in place to tame the cost of living.