Food insecurity to remain challenge over Russia’s invasion of Ukraine, warns NCBA
NCBA Bank now says that Food security will remain a big challenge in 2022 as Russia continues its offense against Ukraine disrupting the global supply chain.
According to NCBA, the weather outlook has also deteriorated citing the initial guidelines by the Meteorological department.
During the NCBA’s Budget 2022/23 Media Review, the Group Managing Director John Gachora urged the government to cut allocation to food security noting little intervention done to enhance supply or lower prices.
This comes even as Members of Parliament await to debate on the Finance Bill that will fund the 2022-2023 budget once tabled in the National Assembly.
“The government cut spending on food security by about Ksh.15 billion in 2022/23,” said Gchora.
The lender is also calling on the government to enhance the allocation for climate change risk mitigation as adaptation proves costly.
On the issue of the fuel crisis that has continued to persist in the country , NCBA has revealed that the situation of the fuel supply shocks will remain profound for the most part of this year.
This means Kenyans will continue to struggle with the surged cost of living as the fuel shortage bites.
The bank noted that despite an elevated cost of living and accelerated cost of doing business, strained public finances weighed down consumer and business expectations for any relief.
“The Budget sought to ensure sustained recovery while keeping public finances on a sustainable path, which meant moderation of expenditure and minimal tax adjustments for consumers and businesses.”
“The budget process was fast-tracked to prevent any disruptions to public services during the general elections and in the transition period.”
The Group has further supported the Treasury’s banking on efficiency gains in tax administration and stronger economic performance to boost revenue outlook.
The financing of President Uhuru Kenyatta’s final budget will attract higher taxes on common household commodities as he vacates office in August this year.
In the Finance Bill 2022, luxury items among others cigarettes, alcohol, and beauty products are among the items to receive higher taxes
The lender, however, projects GDP growth to slow down to 5.2 percent slower than Treasury’s 6.0 percent forecast as consumption and investments slows amid rising costs and uncertainty.