World Bank to release Sh123bn for infrastructure and devolution

Money Markets

Diariétou Gaye: ‘‘We want to see Kenya lifted out of poverty.’’ File 

By GEOFFREY IRUNGU

In Summary

The Sh123 billion to be disbursed in 2014 was factored in Kenya’s Sh1.8 trillion budget and is part of the Sh344 billion ($4 billion) that the bank has committed to Kenya in the next four years.

The World Bank will disburse $1.38 billion (Sh123 billion) to Kenya in the next financial year for infrastructure projects.

 

The Bank launched the Country Partnership Strategy (CPS) 2014-2018 yesterday with roads, energy, health, devolution, transparency and communication, social safety nets and better national statistics among the items it will finance.

The Sh123 billion to be disbursed in 2014 was factored in Kenya’s Sh1.8 trillion budget and is part of the Sh344 billion ($4 billion) that the bank has committed to Kenya in the next four years.

“Our plan is to see Kenyans lifted out of poverty and become a modern economy,” said the World Bank country director for Kenya Diariétou Gaye.

The World Bank estimates that poverty level stands at 39 per cent, having reducing by one percentage point annually since 2006, but now the institution reckons more should be done to meet eliminate it by 2030 as planned.

Treasury secretary Henry Rotich said the projects would contribute to creating employment especially for the youth as the government endeavours to fulfil its promise of a million jobs every year.

The new CPS was approved by the Bank’s Board of Directors in Washington recently and is a successor to the CPS 2010-2013, which concentrated on infrastructure, agricultural productivity and public sector management.

The latest CPS is in line with Vision 2030 and its five-year Second Medium Term Plan for the period between 2014 and 2018. World Bank’s country programme co-ordinator Tom O’brien said poverty alleviation was a key priority under the new CPS, noting that the current level of 39 per cent compared to 47 per cent in 2006.

Poverty levels

“We estimate that poverty levels are at 39 per cent, but this means a reduction of by one percentage point per year, but we need to reduce it by two percentage points per year in order to reach the 2030 goal of eliminating it,” said Mr O’brien.

Council of Governors chairman Isaac Ruto said he expected the water and the health sector to be major beneficiaries under the devolved system.

“We are looking forward to further development in the health sector, for example. We have seen that rural areas now have drugs from KEMSA (Kenya Medical Supplies Agency) unlike in the past,” Mr Ruto said.

“The only challenge is staff, but we are seeing more health workers in the private sector wanting to join us because they no longer have much business to do like in the past,” said Mr Ruto.