Uhuru banks on construction to create jobs

Politics and policy

President Uhuru Kenyatta speaks at the Nyayo National Stadium in Nairobi where he led Kenyans in marking Mashujaa Day celebrations on Oct 20, 2014. PHOTO | BILLY MUTAI 

By EDWIN MUTAI, emutai@ke.nationmedia.co

In Summary

• President Uhuru Kenyatta on Monday said the multi-billion shilling infrastructure projects are expected to generate thousands of direct and indirect jobs.
• The economy generated 742,800 jobs last year with the formal sector accounting for 116,800, according to the Economic Survey 2013.

The Jubilee government is banking on key infrastructure projects to create jobs for millions of unemployed Kenyans, President Uhuru Kenyatta said on Monday.

Mr Kenyatta said the multi-billion shilling infrastructure projects, including the planned tarmacking of 10,000 kilometer roads, standard gauge railway, airports, ports and connecting one million users to the national electricity grid, are expected to generate thousands of direct and indirect jobs.

The economy generated 742,800 jobs last year with the formal sector accounting for 116,800, according to the Economic Survey 2013.

Mr Kenyatta’s bet on infrastructure to generate jobs comes in a year when the economy is expected to grow by between 5.3 per cent and 5.5 per cent, down from the 5.8 per cent previously forecast.

The downgrading of expected rate of economy’s expansion has been attributed to the “many challenges” in the first half of the year.

The Treasury has not detailed the challenges, but Kenya suffered a spate of terrorist attacks during that period that have scared off tourists, hurting a valuable source of national income.

Kenya last month officially changed the base year that is used to compute economic data, adding 25 per cent to the gross domestic product to become Africa’s ninth largest economy.

READ: Kenya's GDP figures revised upwards by 25 per cent

Speaking at the Nyayo National Stadium in Nairobi where he led Kenyans in marking the second Mashujaa Day celebrations since he came to power, the President said his government had commenced a number of transformative initiatives aimed at creating job opportunities for the youth.

Mr Kenyatta promised electricity consumers a significant drop in power bills beginning next month, adding that the country is expected to have installed capacity of 5000 megawatts of green, clean and reliable power on the national grid by 2017.

“Cheaper power will improve food production. Agro-processing and manufacturing firms will be more competitive,” the president said adding that the overall impact should a marked drop in the cost of living.

“Investment in power should also improve education by making learning more accessible. We have connected more than 11,000 schools and intend to have every single primary school connected to the national power grid by end of the current financial year,” he said.

Mr Kenyatta’s faith in big ticket projects’ ability to lift Kenya from the sea of joblessness is backed by key policy actions his government has recently taken to improve the business environment.

In August, for instance, the President launched the annuity concessioning programme that allows contractors to borrow up to Sh260 billion from commercial banks to build roads.

The planned construction of roads, which is set to commence in December and end in 2017, is expected to create nearly 137,000 direct jobs according to government estimates.

The Transport and Infrastructure ministry says the ambitious road plan should create demand for engineers, surveyors, technicians, machine operators and labourers, reducing mass unemployment among Kenya’s growing population.

It is expected that a good roads network will enhance connectivity, reduce the cost of doing business, promote trade and attract investment.

Mr Kenyatta said the legal requirement that 30 per cent of all government tenders be reserved for youth and women would be extended to the construction of the new roads, railway and airports.

The President regretted persistent high food prices that are mainly driven by supply shortages and announced the launch of a 10,000 acre model irrigation scheme in Galana-Kulalu that is expected to help Kenyans access cheap food by 2017.

Mr Kenyatta said the government had launched and doubled hunger and safety programmes targeting vulnerable people and plans to set aside Sh15 billion in a five-year programme that will see food distributed to more counties in Northern Kenya.