Ndii: Kenya is broke

[Higgins the genius]

• Tweet

[RVtitem]

Kenya cannot be broke when china exists.

Uhuru just went for more bag full of cash money.

[audacityofhope]

Kenya cannot be broke when china exists.

Uhuru just went for more bag full of cash money.

@RVtitem, do not make light of grave matters! What is wrong with you RVs? 

How China Got Sri Lanka to Cough Up a Port the answer was yesand of its willingness to play hardball to collect.

Read more at: How China Got Sri Lanka to Cough Up a Port

[audacityofhope]

For those who don't understand what this 16% petroleum product means....

@vooke, Bazungu just explained it as clearly as day and night can be explained! A MUST WATCH!

I urge cs rotich and everyone who supports 16% vat on fuel to watch this video@UKenyatta#PunguzaBeiYaMafuta pic.twitter.com/fnX3yksBkF

— Mnur feruz (@Fmnur) September 1, 2018

[patel]

nikubaya kapsaaaa kabisaaa...dollar account people

1039227003248037889[/tweet]]Invalid Tweet ID[/url]

[RVtitem]

nikubaya kapsaaaa kabisaaa...dollar account people

1039227003248037889[/tweet]]Invalid Tweet ID[/url]

TZ and UG need to build a wall. A deluge of Kenyan economic refugees is coming!

[RVtitem]

For those who don't understand what this 16% petroleum product means....

@vooke, Bazungu just explained it as clearly as day and night can be explained! A MUST WATCH!

I urge cs rotich and everyone who supports 16% vat on fuel to watch this video@UKenyatta#PunguzaBeiYaMafuta pic.twitter.com/fnX3yksBkF

— Mnur feruz (@Fmnur) September 1, 2018

I do not agree with those mzungu. They want to come to africa and rip-off resources while paying zero taxes, but only provide minimum wage zero skill jobs and few tiny CSR to natives. At the same time repatriating all profits to their countries.
 
African leaders are often sell outs who sign bad deals so long as they have got a cut in the western investments.

[RV Pundit]

The usual nonsense from ndii

[hk]

nikubaya kapsaaaa kabisaaa...dollar account people

1039227003248037889[/tweet]]Invalid Tweet ID[/url]

Actually kenyans have already heeded your call. Check out the number of dollar accounts and deposits https://www.businessdailyafrica.com/markets/currencies/Forex-deposits-hit-all-time-high-of-Sh500bn/3815522-4681872-egddkcz/index.html . Its a hedge against the shilling. The only person who thinks kenya economy is doing well pundit. 

[RV Pundit]

Tax amnesty & increase remittance - the money is flowing in external - it's not kenyans opening forex accounts.

Actually kenyans have already heeded your call. Check out the number of dollar accounts and deposits https://www.businessdailyafrica.com/markets/currencies/Forex-deposits-hit-all-time-high-of-Sh500bn/3815522-4681872-egddkcz/index.html . Its a hedge against the shilling. The only person who thinks kenya economy is doing well pundit. 

[RV Pundit]

He doesn't understand with nearly 50% of economy informal & black market - it just not possible to have low tax rate - if you try that - there won't be any taxes to do anything. See Nigeria. Africa countries have to keep formalizing - and until that happens - it going to be impossible to have low tax rate.

Once nearly everyone is paying taxes like in developed world - then having low tax become feasible - although Scandinavian have shown us the reverse is desirable - high tax seem to translate to more general happiness - if gov is honest.

I do not agree with those mzungu. They want to come to africa and rip-off resources while paying zero taxes, but only provide minimum wage zero skill jobs and few tiny CSR to natives. At the same time repatriating all profits to their countries.
 
African leaders are often sell outs who sign bad deals so long as they have got a cut in the western investments.

[hk]

Tax amnesty & increase remittance - the money is flowing in external - it's not kenyans opening forex accounts.

I know that's what the writer wrote but its wrong. Lets take increase in remittance; Is it that the number of kenyans in diaspora has increased to justify increase in remittance? Or is it that diaspora is earning more to justify increase? Better yet is that kenyans in diaspora are investing more in kenya due to increase in economic confidence of kenya? Has kenyan exports increased? The answer to all those questions is No. Mind you we're talking about bank deposits in forex not forex reserves in CBK.  Tax amnesty; if its what has led to increased deposits  it means money being repatriated is kept in forex fortify my argument that they're hedging against the shilling. Otherwise they'd be converting into shillings.

[RV Pundit]

Remittance could be linked to booming US economy - more jobs/hours/wages - and all the digital revolution that makes sending forex easy - tax amnesty saw a spike - and generally if the forex risk that IMF were suppose to take care of - have taken care of itself. The pittance of 1.5B dollars.

Uhuru just need to sign the new finance bills - remove VAT on fuel & the economy will continue humming along.

This is a confidence game - if he keeps VAT - then everyone will wrongly thing we are in an economic crisis - which then become a self-fulfilling prophesy.

The likes of Dr Ndii have been saying the same nonsense of gov is broke for years so I won't pay attention to it.

I know that's what the writer wrote but its wrong. Lets take increase in remittance; Is it that the number of kenyans in diaspora has increased to justify increase in remittance? Or is it that diaspora is earning more to justify increase? Better yet is that kenyans in diaspora are investing more in kenya due to increase in economic confidence of kenya? Has kenyan exports increased? The answer to all those questions is No. Mind you we're talking about bank deposits in forex not forex reserves in CBK.  Tax amnesty; if its what has led to increased deposits  it means money being repatriated is kept in forex fortify my argument that they're hedging against the shilling. Otherwise they'd be converting into shillings.

[gout]

The economy is on steroids - going down. Mismanaging the economy has always been effortless as Moi proved.

2017/2018 - Job cuts leave 29 billion hole
https://www.businessdailyafrica.com/news/Job-cuts-leave-KRA-Sh29bn-income-tax-gap/539546-4753784-mqdh0s/index.html

2016/2017 - Job cuts leave 34 billion hole
https://www.businessdailyafrica.com/economy/Job-cuts-KRA-taxman-budget-hole-Sh34-billion/3946234-3936438-cfd2suz/index.html

The remittance increases are mostly from the politically/economically incorrect Arab menial jobs. Kenyan immigrant workers are obviously feeling the heat from Trump policies.

Talking of Trump policies; fuel prices are likely to even get higher with Iran sanctions coming. And, yes, no way Uhuru is signing the Finance Bill from parliament. It is likely they will further increase tax on alcohol!! and still retain the VAT on fuel.

[hk]

Remittance could be linked to booming US economy - more jobs/hours/wages - and all the digital revolution that makes sending forex easy - tax amnesty saw a spike - and generally if the forex risk that IMF were suppose to take care of - have taken care of itself. The pittance of 1.5B dollars.

Uhuru just need to sign the new finance bills - remove VAT on fuel & the economy will continue humming along.

This is a confidence game - if he keeps VAT - then everyone will wrongly thing we are in an economic crisis - which then become a self-fulfilling prophesy.

The likes of Dr Ndii have been saying the same nonsense of gov is broke for years so I won't pay attention to it.

I know that's what the writer wrote but its wrong. Lets take increase in remittance; Is it that the number of kenyans in diaspora has increased to justify increase in remittance? Or is it that diaspora is earning more to justify increase? Better yet is that kenyans in diaspora are investing more in kenya due to increase in economic confidence of kenya? Has kenyan exports increased? The answer to all those questions is No. Mind you we're talking about bank deposits in forex not forex reserves in CBK.  Tax amnesty; if its what has led to increased deposits  it means money being repatriated is kept in forex fortify my argument that they're hedging against the shilling. Otherwise they'd be converting into shillings.

The argument is about increased bank forex deposits to the tune of $600m. Remittance normally is sent in forex then converted to shilling its not kept in forex. Normally remittance would be captured by CBK forex reserve cause literally CBK buys the forex in shillings. i.e they keep the forex and sells shillings.  This means Kenyans are opening USD accounts to hedge against the shilling.
Treasury is scrambling to fund $26b budget that's why they had to VAT fuel. And since economic growth has been driven by goverment spending halting of new projects will surely mean slower growth. Government can't borrow more or raise more taxes. So the liberal policy of tax and spend is over.

[hk]

He doesn't understand with nearly 50% of economy informal & black market - it just not possible to have low tax rate - if you try that - there won't be any taxes to do anything. See Nigeria. Africa countries have to keep formalizing - and until that happens - it going to be impossible to have low tax rate.

Once nearly everyone is paying taxes like in developed world - then having low tax become feasible - although Scandinavian have shown us the reverse is desirable - high tax seem to translate to more general happiness - if gov is honest.

I do not agree with those mzungu. They want to come to africa and rip-off resources while paying zero taxes, but only provide minimum wage zero skill jobs and few tiny CSR to natives. At the same time repatriating all profits to their countries.
 
African leaders are often sell outs who sign bad deals so long as they have got a cut in the western investments.

Why do we have large informal and black market? Its partly due to high taxes that prevent formalization. He points out that even nike can't put a sweat shop in africa cause labour is very expensive due to taxes and low productivity.

[RV Pundit]

Well that is your theory - but the story says -"Foreign currency deposits in local banks have risen past the half a trillion mark for the first time, mainly driven by Kenyans sending money home to take advantage of the tax amnesty programme."

With regard to gov public investment and 26-30B budget - I think as we wait for 2nd Q figures - the first Q1 figures were really good - agricluture - which is still the elephant in the house (25% of gdp - and probably twice as industry) - is generally kicking butt this year - and none of the sector was down !!!

I think economy is doing fine - it's just hiccups otherwise its very likely the economy will grow by 6.5% and here we are crying.

I know that's what the writer wrote but its wrong. Lets take increase in remittance; Is it that the number of kenyans in diaspora has increased to justify increase in remittance? Or is it that diaspora is earning more to justify increase? Better yet is that kenyans in diaspora are investing more in kenya due to increase in economic confidence of kenya? Has kenyan exports increased? The answer to all those questions is No. Mind you we're talking about bank deposits in forex not forex reserves in CBK.  Tax amnesty; if its what has led to increased deposits  it means money being repatriated is kept in forex fortify my argument that they're hedging against the shilling. Otherwise they'd be converting into shillings.

[/quote]
The argument is about increased bank forex deposits to the tune of $600m. Remittance normally is sent in forex then converted to shilling its not kept in forex. Normally remittance would be captured by CBK forex reserve cause literally CBK buys the forex in shillings. i.e they keep the forex and sells shillings.  This means Kenyans are opening USD accounts to hedge against the shilling.
Treasury is scrambling to fund $26b budget that's why they had to VAT fuel. And since economic growth has been driven by goverment spending halting of new projects will surely mean slower growth. Government can't borrow more or raise more taxes. So the liberal policy of tax and spend is over.
[/quote]

[RV Pundit]

That is probably one reason - and I think parliament & treasury just need to beef up their research capacity - to fine-tune taxation and budget making. As for Nike - there are so many factors outside taxes -- and only solution is to enact several EPZ or Special Economic Zones - where anything goes - as long as they can employ million people - they get tax holidays/competitive labour/free land - that is what Uganda are using to kickstart their manufacturing.

Kenya we just need to have 47 Special Economic Zones in each county. Those are zones that will be employment centers --- but investors have to get free land, tax holiday, subsidized electricity and cheap power --- as long as we make sure these are export-oriented industries.

Looking at our budget - I am not sure there is any space to cut spending. We need to be spending more.

If treasury are having trouble - it's time to sell some assets - Safaricom is sitting at around 400B kshs - 35% of Kenya Gov shareholding there. People are making noises about Jubilee because they've leverage externally debt - but nobody is telling us how many assets Kibaki sold.

Why do we have large informal and black market? Its partly due to high taxes that prevent formalization. He points out that even nike can't put a sweat shop in africa cause labour is very expensive due to taxes and low productivity.

[hk]

Well that is your theory - but the story says -"Foreign currency deposits in local banks have risen past the half a trillion mark for the first time, mainly driven by Kenyans sending money home to take advantage of the tax amnesty programme."

With regard to gov public investment and 26-30B budget - I think as we wait for 2nd Q figures - the first Q1 figures were really good - agricluture - which is still the elephant in the house (25% of gdp - and probably twice as industry) - is generally kicking butt this year - and none of the sector was down !!!

I think economy is doing fine - it's just hiccups otherwise its very likely the economy will grow by 6.5% and here we are crying.

Yes that's my theory and I have given reasons why. Agriculture might do ok due to good rains. But for sure manufacturing,trade and services are struggling. For economy is supposedly booming how come there are so many layoffs and profit warnings?

[RV Pundit]

That always happens - some are layoff - some are hiring. Nakumatta went down and all their stores have been snatched by foreign and local supermarkets. The same is true for other companies. If not local - china man is of course killing everyone everywhere.

Yes that's my theory and I have given reasons why. Agriculture might do ok due to good rains. But for sure manufacturing,trade and services are struggling. For economy is supposedly booming how come there are so many layoffs and profit warnings?