UPDATE 2-Kenya cuts 2017 growth forecast due to drought and political uncertainty
(Adds comments on revenue, election funding) By Duncan Miriri NAIROBI, Sept 15 (Reuters) – Kenya lowered its 2017 economic growth forecast to 5.5 percent due to drought and political uncertainty, a top official said on Friday, as the government cut non-essential spending to free up funds for a repeat presidential election.
Kenya has the highest per capita income in the region and is known for its capitalist tradition, stability and role as a Western ally.
It hosts the regional headquarters of several global firms.
The government had initially projected a 5.9 percent growth for this year but the economy expanded 4.7 percent in the first quarter, mainly due to poor agricultural performance.
The revenue target is 1,549.4 billion shillings for the fiscal year.
“There is a shortfall in customs.
Adding to the squeeze, the electoral board has requested 12 billion shillings for the presidential re-run.
There is the need to provide for security and so those costs could be much higher than the 12 billion.
This was not budgeted for,” Thugge said, adding they will cut non-essential expenditure to fund the poll.
Government officials will no longer be allowed to travel outside the country without clearance from the president and domestic travel will also be reviewed, he said.