World Bank Lists 3 Ways to Lower Poverty Rate in Kenya


The World Bank in the  Kenya Poverty & Equity Assessment 2023 Report released on Thursday offered three recommendations to reduce the rate of poverty in the country.

According to the report, the rate had reduced, but after the pandemic in 2020, the gap between the rich and the poor widened.

World Bank also advised against the use of subsidies to cushion farmers, one of President William Ruto’s key agenda. The international body suggested that it was better to invest in key infrastructure, research, and development.

Additionally, the World Bank suggested the replacement of the input subsidies with a voucher of an equivalent amount of cash. This would help the poor households make better farming decisions.

President William Ruto (in grey coat) in Nakuru during the launch of a new fertiliser variety on Friday, March 3, 2023

PCS

“Kenya’s economic growth has the potential to pull millions more out of poverty, even in challenging economic contexts. An inclusive growth strategy that boosts economic opportunity and productivity among the poorest, while maintaining focus on longer-term development objectives, will help realise that potential.,” read part of the report.

“Domestic fertiliser prices are subject to global conditions, and the promotion of local (or within Africa) production of fertiliser potentially offers a less distortionary way to make this input affordable,” read the report in parts.

Ruto was advised to connect the poor to economic growth, strengthen households’ resilience to adverse weather shocks, and leverage fiscal policy to support poverty reduction objectives.

Connect the poor to economic growth

According to the World Bank, Kenya should use agriculture sector policy to build the productive capacity of rural poor households to grow and diversify their income sources.

Additionally, Kenya should rely on SME development to reach the urban poor, self-employed, and household enterprises to provide training and sustainable financing options.

“Loans and grants of sufficiently large sizes can be effective in reducing reliance on own-source funding and raising earnings,” the report read in parts.

Strengthen households’ resilience to adverse weather shocks

The government was urged to tackle the effects of Climate Change to ensure sustained high rates of economic growth that result in inclusive growth.

World Bank complained that arid counties in Kenya experience the largest negative poverty impact due to Climate Change despite having the highest baseline poverty rates.

“Strengthening resilience needs to reflect spatial differences to climate risk exposure and vulnerability,” read part of the report.

The global financial body also suggested that Kenya should build climate-resilient infrastructure, invest in comprehensive and inclusive disaster risk management, and build inclusive institutions.

Leverage fiscal policy to support poverty reduction objectives

World Bank advised Kenya to expand social assistance programs such as hunger safety nets to help reach less-well of households.

Additionally, Kenya was lauded for investing in the education sector, especially offering tuition to the poor, thus building human capital.

Education Cabinet Secretary Ezekiel Machogu poses with students during the distribution of food to learners in Turkana on April 7, 2023.

Photo

Ministry of Education





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