Kenya's budget expected to focus on turning around economy

The Kenyan government faces tough decisions in opening up the economy while keeping Covid-19 under control and avoiding the collapse of its health system.

This year’s budget to be unveiled on Thursday is expected to focus on turning around the economy, which the World Bank expects will slow down from 5% growth to just 1%.

Recently President Uhuru Kenyatta said relaxing restrictions by only a fifth could lead to 30,000 deaths by December. He added that up to half a million jobs could be lost in the next six months if the country didn’t get on track.

Small businesses here are struggling because many of their main clients, the slum dwellers themselves, lost their income as casual workers in companies that have closed down due to Covid-19 restrictions.

On the outskirts of Nairobi, private vehicles are lined up on either side of the road for over 100 metres. Many of these vehicles used to ferry their owners daily to their places of work or to their businesses. But now, they are temporary grocery shops.

Tony Watima, an economist based in Nairobi, says the journey to full recovery will take years.

"For now, it’s about stabilisation. And then later, when we are moving out of COVID-19, we talk about stimulating the economy. Now that’s when we talk about creating jobs, bringing people back to labour, creating a conducive environment for investors, and all that. So, we cannot talk about stimulating the economy at this time when you still have lockdown effects," he says.

Kenya remains under a countrywide overnight curfew and movement in and out of its two largest cities of Nairobi and Mombasa is restricted until at least the first week of July.