Many Kenyans aren't worried about IMF's role in Kenya's economy because they do not understand or appreciate its importance in stabilising the global economy. They are worried because the IMF often gets it wrong on its prescriptions for developing countries.
THREAD ๐งต
THREAD ๐งต
The IMF tends to implement one size fits all prescriptions that are not fit for purpose when a country's peculiarities are put into consideration. These customised solutions lifted from developed economies and textbooks can't work for developing countries.
Some of the things the IMF is prescribing like ending tax incentives, brainlessly stopping subsidies including during an emergency, privatising everything including water, increasing NSSF's contributions etc. don't make any sense.
Look at how European countries have subsidised energy to cushion their citizens against the Russia-Ukraine war. Does the IMF lecture them about that?
Yet it is telling us to end food subsidies in the midst of the worst drought emergency in over 40 years. Who listens to such advice?
Savings are a function of income. You can't save what you don't have.
Savings are a function of income. You can't save what you don't have.
The best way to increase retirement savings is to grow the economy and get people more disposable incomes. That way, people will have something left to save after meeting immediate needs. Only a mad man can save for retirement on an empty stomach.
Regarding privatisation, you can't privatise everything. The IMF and the World Bank brought us the Independent Power Producers who have made the cost of power insanely high.
As a result, our economy is no longer competitive. Now the IMF and World Bank want us to privatise electricity transmission. Can't we learn from history? Privatising power generation has already caused us a lot of pain. How will privatising power transmission help?
It is a lie to claim that once you mess up economically only the IMF can get you out of the crisis. Do we need the IMF to tell us to live within our means?
As I have said often, we have exhausted our taxation and borrowing capacity. Our only way out is to cut spending and implement policies which will grow the economy.
All these shenanigans from the IMF are like a man fitting a maize cob to cure diarrhea. It simply just doesn't work.
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