Highlights From Budgets of Five East African Economies in ChartsBy
Kenya plans to repeal rate-cap law, abandons tax-increase plan
Mauritius will spend more than $1 billion on transport
Finance ministers in five East African countries presented their spending plans for the fiscal year that starts July 1 on Thursday. These are some of the highlights in the budget speeches from economies in the continent’s fastest-growing region.
Kenya plans to repeal a law that caps commercial interest rates, after it crimped lending by banks in East Africa’s biggest economy, Treasury Secretary Henry Rotich told lawmakers in Nairobi. The measure, introduced in August 2016, exacerbated a slowdown in credit growth to the private sector. While the government aims to increase spending next year, it has abandoned plans to raise personal income tax and capital-gains tax to boost revenue.
The Mauritian government will spend 37 billion rupees ($1.1 billion) on its road and rail systems over the next three years, even as it seeks to reduce the budget deficit, Prime Minister and Finance Minister Pravind Jugnauth told lawmakers in Port Louis. Economic growth will probably quicken to 4.1 percent in the coming fiscal year, from 3.9 percent this year amid a “firm upswing” in business and consumer confidence, he said.
Public debt in Africa’s largest coffee producer stood at $10.5 billion in March, taking its ratio to gross domestic product to 38 percent. That’s lower than the 50 percent threshold beyond which it could be unsustainable, Finance Minister Matia Kasaija told lawmakers in the capital, Kampala. The country’s policy of keeping debt at “safe levels” will be “challenging” in the coming fiscal year because of a higher-than-envisaged budget deficit, the International Monetary Fund said Wednesday.
Tanzania will reduce corporate income tax for new companies to 20 percent from 30 percent for their first three years of operation to encourage investment, Finance Minister Philip Mpango told lawmakers told lawmakers in Dodoma. The government will allow a tax amnesty from July 1 until Dec. 31 for those who have not paid tax in the past, which will help the government collect 500 million shillings ($220,448), he said.
GDP will expand 7.2 percent this year and 7.8 percent next year in the $8.4 billion economy, Finance Minister Uzziel Ndagijimana told lawmakers in the capital, Kigali. GDP has risen at 6 percent or more since 2014. The current-account deficit will be $825.6 million in 2018, rising to $951.4 million in 2019.
— With assistance by Kamlesh Bhuckory, Kenneth Karuri, Fred Ojambo, David Herbling, and Saul Butera