JULY 31, 2016.
PRESIDENT KENYATTA MUST SIGN BILL ON INTEREST RATES INTO LAW:
Last week, Parliament passed a Bill capping bank interest rates at four per cent above the indicative Central Bank Rate (CBR). I take this opportunity to thank the MPs for this patriotic move.
This Bill comes at a time interest rates have been pushed up particularly by increased borrowing from the domestic market by the government, something Jubilee promised not to do.
The Jubilee Government’s borrowing from the local market is higher than that of any regime in the last 10 years. This has pushed individuals and corporations out of competition for money from banks, which has in turn slowed economic activity.
High commercial lending rates, often around 18 percent or more, have stifled businesses and particularly killed upstarts like youth projects. High interest rates, like the cost of power, has forced some investors to relocate to neighbouring countries with better rates.
None other than the Governor of the Central Bank Dr Patrick Njoroge has admitted that lending rates are too high and that banks should be persuaded to lower them. We have in the past adopted this root of persuasion and trusted banks to act in the interest of clients and would be clients. But banks have failed the test. A law has therefore become necessary to respond to the pain of our citizens.
This Bill is now in the hands of President Uhuru Kenyatta. We expect the President to act in the interest of suffering Kenyans and sign this Bill into law without further excuses and unnecessary delays.
HON RAILA ODINGA;
CORD COALITION/ ODM PARTY LEADER
JULY 31, 2016