This archive report was first published on 6 November 2019.
Wednesday, November 6, 2019, marked a significant year for many organisations in Kenya, with rising costs, reduced consumer purchasing power, and increased regulatory actions posing significant business challenges.
According to Safaricom Chairman Nicholas Ng'ang'a, the Central Bank of Kenya (CBK) Governor Patrick Njoroge noted that most Kenyans have not felt the effects of the GDP growth, which is largely driven by government spending on infrastructure that has not trickled down to consumers.
Ng'ang'a highlighted that the advent of digital lending facilities such as M-Shwari and Fuliza has enabled more Kenyans to access credit facilities, boosting their economic activities. He believes that when well utilised, credit facilities can allow Kenyans to prosper and the economy to grow.
However, Ng'ang'a expressed concerns about the negative impact of increased taxation on the telecommunications sector. He argued that raising taxes risks introducing a rebound effect, adding pressure on consumers and businesses already struggling under tough economic conditions.
Ng'ang'a pointed out that Safaricom remitted Sh 98.13 billion in duties, taxes, and licence fees in the last financial year, and it is crucial for both the National and County Governments to balance revenue maximisation and business growth.
He also expressed support for the Airtel-Telkom merger, but with conditions. Ng'ang'a raised concerns about the debt owed by the two operators, the need to rebalance frequencies allocation, and the need for equal treatment of operators and creation of a level playing field within the industry.
