Kenya still has large infrastructure gaps that must be tackled, if growth is to be raised and jobs created. The country’s newfound natural resource wealth is an opportunity to lift economic prospects, but these resources need to be exploited wisely and transparently.
Kenya is currently building a fiscal and regulatory regime to govern the use of revenues from natural resources development. This should provide a transparent framework for investors and a stable base for government revenue. Beyond that, the use of these fiscal resources should be carefully prioritized, and the quality of infrastructure projects closely scrutinized. The IMF stands ready to continue to provide extensive technical assistance on these issues.
Foreign investment should also be encouraged to help plug infrastructure needs. I understand that foreign investors are interested in financing major projects, such as the construction of a modern railway line from the coastal area of Kenya to neighboring countries, and the expansion of geothermal power generation. Again, these types of financing should be encouraged, provided that they remain consistent with a sustainable debt position.
My third “C”: Continuing regional integration
In Sub-Saharan Africa, Kenya has led the way in the process of regional integration. It is now the second largest investor in the region, and is a strong advocate of regional economic integration in the context of the East African Community.
Regional integration has opened up new markets, supported the emergence of a middle class, and enabled domestic demand to become an engine of growth. The process must now be deepened. In that context, the heads of states of the East African Community recently agreed on a roadmap toward a monetary union. This is an opportunity but also a major challenge. It will be important to draw upon the experience and lessons learned from other regions, and to manage the process carefully. The IMF stands ready to provide technical assistance and advice, as needed.
Let me conclude: over the past several years, Kenya has embarked upon a successful journey that has transformed its economy. This has been achieved with the leadership and support from the public sector, but also largely through the efforts of a vibrant private sector. This partnership has increasingly helped to lift the Kenyan people out of poverty and generate job opportunities.
In this context, I would like to touch on a subject that is dear to me—education. Kenya’s record in providing universal primary education is impressive, especially for girls. Going forward, it is crucial that girls have this access at the secondary and university levels.
So, Kenya’s journey to middle-income status is not over. There is still a long way to travel, but I believe this country’s high hopes are warranted. I have tried today to chart out how that path can be successfully navigated.
As the Kenyan wisdom goes: “Pamoja twasonga mbele”—“Together we are moving forward”. As a nation you have made it this far and—together with the IMF—I am confident that Kenya will continue to move forward.
“Asante sana” – Thank you very much.