Kenya taking too long to achieve low fertility

Planning Minister Wycliffe Oparanya concurs with the observation, warning that the high growth rate has adverse effects on spending in infrastructure, health, education, environment, water and other social services.

According to the minister, Treasury might find it more difficult than ever before, to meet the increasing demands, if the growth trends are not checked.

Only 0.4 million jobs created

Last year, according to the 2010 Economic Survey, only 0.4 million jobs were created in 2009, which is a drop in the ocean for the thousands of unemployed youths and the ones entering the labour market every year.

Of the country’s 38.1 million people, 32.5 million are aged five years and above, of which only 15.8 million are employed. This means the dependency ratio is still high, a factor that has prevented the employed from saving and investing.

Owino says the national government and county governments will need to come up with a better taxation structure to ensure the small percentage of the employed population are not over burdened.

“It is this small population mainly found in urban centres that takes care of dependents both in towns and rural areas, hence care should be taken when formulating taxation policies,” says Owino.

Currently, the country’s economic growth rate, of about 4 per cent, will need to increase further to an average of 10 per cent to effectively sustain the population growth, averaged at 2.8 per cent per year.

It is for this reason that the economic blueprint, Vision 2030, was formulated to help transform Kenya into a middle-income country by achieving the 10 per cent growth target, by 2012, and sustaining it for the next 10-plus years.

However, increased savings and investments, one of the key factors that can help Kenya realise the objective, still remains low, as majority of the employed population live from hand to mouth.

According to the government’s public expenditure review records, public savings rate has been low, and at times negative, making private savings the main source of domestic savings.

The latter, has also declined to 13.8 per cent of the GDP in 2009 from 14.8 per cent the previous year, leaving the country with even less disposable income.

However, all is not lost. According to Tiberius Barasa, governance and public policy specialist, the creation of counties provides the country with a good opportunity to decentralise development and create more employment opportunities for the youth.

“County governments once created, must endeavour to provide adequate and quality services to the residents. If that is done, there will be no need to move to Nairobi,” Barasa says.

It is a matter of time for the one million youths who will be adults in the next two years to know whether their needs will be met by the national and county governments.