Kenyan President William Ruto on Friday (July 5) proposed spending cuts and additional borrowing in roughly equal measure to fill a nearly $2.7 billion budget hole caused by his withdrawal of planned tax hikes in the face of nationwide protests.

Nairobi

Anti-tax protests in Kenya have spread across the country. One person has been killed and over 200 injured. 

Kenya protests

Kenyan President William Ruto has announced plans to address a significant budget shortfall following the withdrawal of proposed tax hikes. This adjustment was made in response to widespread and deadly protests. President Ruto intends to bridge the gap through a combination of spending cuts and additional borrowing.

In a recent speech, President Ruto detailed cuts exceeding one billion U.S. dollars and outlined plans for increased borrowing. He acknowledged that this approach would elevate the fiscal deficit beyond initial projections. The proposed austerity measures include the closure of 47 state corporations, a 50 percent reduction in government advisers, and the elimination of budget lines for the president and deputy president's spouses.

The president's announcement comes amidst the most severe crisis of his term, with at least 39 people killed in clashes with police. Nationwide protests have been fueled by growing public discontent over rising living costs. President Ruto, balancing international lender demands with domestic pressures, engaged directly with the populous through a live audio forum, where he faced tough questions on issues of police brutality, alleged abductions, and economic policy.

Despite the government's stance that criminals have exploited the unrest, activists claim the violence is a result of actions by thugs hired by politicians to undermine the protest movement. Protesters continue to call for President Ruto's resignation.



Kenyan president to cut spending amid violent protests

After deadly protests against the Kenyan president's finance bill containing tax increases, the bill has been scrapped, and now President William Ruto has unveiled plans to plug the massive hole in the budget. At least 39 people were killed in recent clashes with police, amplifying the biggest crisis of Ruto's term so far. In a Friday speech, Ruto said he would ask for not tax increases, but spending cuts amounting to over one billion U.S. dollars for the fiscal year that began this month, as well as additional borrowing. Whatever we are going to borrow, the difference, will increase our fiscal deficit from what I intended. The president has been caught between the demands of lenders like the International Monetary Fund to cut deficits, and citizens reeling from rising living costs. According to Ruto, austerity measures will include the end of 47 state corporations, a 50 percent reduction in the number of government advisers, along with the removal of budget lines for the president and deputy president's spouses. I believe these changes will set out our country on a trajectory towards economic transformation. Following the speech, Ruto hosted a live audio forum on X meant to engage with young people. He faced sharp questioning about police brutality, alleged abductions by state security agents, and economic policy. Many protesters are still calling for the president to resign. Activists have blamed the violence on thugs hired by politicians to discredit the protest movement. But the government has said that opportunistic criminals are responsible.

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