Kenya's budget reflects economic progress
Africa was amazed. Few believed that Kenya, a non-oil-producing country, suffering like others F ooft'' budget that hardly hurt anyo The no-pinch budget shows that the harsh rules laid down by the International Monetary Fund for Kenya have been paying off. Devaluation and tightened imports over the past few years have helped the nation gain a measure of economic stability.Skip to next paragraph
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The budget also signals that many things are going right in this country despite an abortive coup attempt last August and a continuing, serious balance-of-payments problem. (The nation spends 50 percent of its export income on oil.)
The budget - which helps local manufacturers by lowering duties on imported materials - appears to hurt only beer drinkers and bankers (whose license fees were raised 50 percent).
To promote exports of locally manufactured goods, Finance Minister Arthur Magugu lowered most import duties currently above 30 percent by 14.7 percent. This will give local factories cheaper steel and plastics. But the sales tax on exports was raised by 2 percent.
The income tax was not changed, and interest earned on savings accounts was exempted from taxation to encourage Kenyans to save more.