We must cushion the economy from polls hiccups. file photo | nmg
Summary
The
latest data show that between June and December 2017, the cash
individuals and businesses kept at home and walked with in pockets rose
from a mere Sh18 billion to Sh225 billion, an increase of 207 billion.
According
to analysts, this state of affairs hurts financiers’ liquidity,
signalling a difficult time for the banks themselves, investors, and
individuals who may require money for various programmes, the volatile
elections period notwithstanding.
This was not the
first time such huge withdrawals tied to anxiety hit the banks. It is a
known cycle every five years, when all and sundry weigh options and sit
back to return to normal business only after elections.
It
would be defeatist for the government and other institutions to resign
to fate that during polls, keeping money under the pillows, so to speak,
is safer than at the bank and other financing institutions.
Time
is ripe to come up with the right tools and incentives that will
cushion the economy from the electoral hiccups and motivate savers to
leave their cash at bank. Other activities must run as the polls are
around the corner.
As it is, the economy gets exposed, creating a huge trough of stagnation every five years of the election cycle.
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