by Ronald Njoroge
NAIROBI (Xinhua) -- Kenya government
is planning to offer tax incentives for low-cost airlines to fly
into the country to attract more international tourists,
Kenya has set a target to raise the
number of international travelers from 2 million in 2018 to 3
million by the end of 2022, Najib Balala, cabinet secretary in
the Ministry of Tourism and Wildlife, told journalists in
Nairobi on Monday evening.
"We are planning to roll out tax incentives for low-cost
airlines that will bring visitors into Kenya beginning the next
financial year," Balala told an event celebrating his winning
the World Travel and Tourism Council’s Global Champion Award at
the 2019 Global Summit in Seville, Spain, for Kenya’s work on
promoting the social impact in the tourism sector.
Government data indicates that international tourists spent
over 157 billion shillings (1.57 billion U.S. dollars) in Kenya
Balala said the incentives will not impact the role of Kenya
Airways, the national flag carrier, in attracting more inbound
No country in the world has developed a vibrant tourist
sector without leveraging on low-cost airlines to bring in
tourists, he said.
Kenya is keen to embrace an open sky policy to ensure that
more international airlines operate in the country, Balala said.
The availability of affordable flights into Kenya from major
global cities in the United States, Europe and Asia will boost
the number of tourists in Kenya, he said, noting that the number
of international visitors coming into Kenya is very low compared
to its unique beach and wildlife products.
Kenya to encourage African
firms to list at Nairobi bourse
NAIROBI (Xinhua) --
Kenya plans to woo African firms to list at the
Nairobi Securities Exchange (NSE) in order to make the country a
regional financial hub, officials said on Monday.
Geoffrey Odundo, chief executive officer of NSE told Xinhua
in Nairobi that so far Ugandan and Rwandese firms have cross
listed at the Nairobi bourse.
"We want to encourage more African blue chip firms to list
their shares at the NSE so that they can enhance the liquidity
of the Kenyan capital markets," Odundo said when the Institute
of Certified Financial Analysts (ICIFA) entered into an
agreement with the NSE.
Odundo said that Kenyan capital market provides an
opportunity for African firms to raise affordable long term
finance to expand their operations.
Odundo said that Kenya is focusing on increasing the number
of firms list at the NSE.
"More firms trading means that investors have a large pool of
equity instruments to choose from,"he said.
He said that Kenya has a large pool of both institutional and
retail investors that are willing to invest in firms that will
offer good returns.
The NSE has also developed an incubation program that aims to
lure more local firms to consider listing at the NSE in order to
deepen local markets.
Odundo revealed that Kenya has a series of tax incentives for
firms that list at the NSE.
He said that more firms will help to deepen the securities
exchange where more than 60 percent of the market capitalization
is currently dominated by six companies.
Nairobi bourse to
establish derivatives exchange by end of 2019
NAIROBI (Xinhua) --
Kenya’s Nairobi Securities Exchange (NSE) plans
to establish a derivatives exchange by the end of 2019, an
official said on Monday.
NSE CEO Geoffrey Odundo told Xinhua in Nairobi that only one
more link in the overall structure of the market is yet to be
developed but the trading platform for the derivatives market
has already been finalized.
"We are keen to have the derivatives market functional by the
end of 2019 so that Kenya can expand the array of capital market
products available in the country," Odundo said when the NSE
entered into an agreement with the Institute of Certified
The derivatives exchange, a financial market for instruments
such as futures and options, will help attract new investors
into Kenya, Odundo said.
The exchange will initially focus on equity products and then
cover other capital market products, he said.
The NSE has already conducted a successful pilot of
derivatives trading, Odundo said.
Kenya is keen to tap into the large pool of global investors
who prefer trading in derivatives products, he said.
Analyst urges Kenya to
expand tax base to remain above IMF revenue threshold
NAIROBI (Xinhua) --
Kenya should expand its tax base in order to
remain above the International Monetary Fund (IMF) revenue
threshold of at least 15 percent tax to gross domestic product
(GDP) ratio, analysts said on Tuesday.
Judd Murigi, head of research at ICEA LION Asset Management,
said Kenya’s revenue-to-GDP ratio fell to 17 percent in 2018,
after remaining relatively constant at 18-19 percent between the
fiscal years 2014 and 2018.
"The revenue collection rate can still be improved, as has
been seen in other developing countries that have significantly
enhanced their tax collection by ensuring the war on corruption
is won, broadening the tax base via simplifying the tax system,
lowering rates and reducing unnecessary exemptions," Murigi said
during the release of the April 2019 Investor Pulse Report.
Murigi noted that the bulk of the Kenya’s labor force is in
the informal sector and as a result don’t pay income tax.
The non-formal sector could be incentivized to pay taxes if
they are subjected to lower taxation rates, he said.
Murigi called on the government to further leverage the use
of technology to capture more workers under the tax bracket.
Kenya needs to reform its fiscal policies to ensure that
development expenditure is prioritized as opposed to recurrent
expenditure, he said.
Development expenditure ub 2018 will be at its lowest
absolute level since 2013, Murigi noted.