High rate of inflation that has worsened against a backdrop of drought is a threat to sustainable development in Kenya, experts said on Thursday.
Prof Tom Nyamache, an economics lecturer at Turkana University College said in an interview that the high cost of living depletes cash reserve intended for investments thereby suppressing opportunities for economic growth.
“High cost of living creates a poor nation with disempowered people.
“In order to establish a sustainable middle income economy, there must be an increasing number of people moving beyond meeting their daily needs.
“They have shifted to making investments creating and doubling economic opportunities for others,’’ Nyamache said.
The don said policies protective against citizen’s exploitation were necessary to save families from plunging into misery while searching for basic needs especially food.
“How people get food, how reliable the supply is and in what quality, is a major consideration when talking about sustainable development.
“Hungry people have no energy to be productive or think about anything else except how to meet their daily needs,’’ Nyamache said.
At the moment, majority of Kenyans are consuming government’s subsidised maize flour retailing at a set flat rate of 0.9 dollars.
However, there is little to meet the demand prompting citizens to scramble for the available in some wholesale and retail outlets across the country.
Inflation rate rose to 11.70 per cent in May from 11.48 per cent attributed to a surge in prices of food, Kenya Bureau of Statistics explained in its latest periodical update.
Prof George Gongera, the Dean of Faculty of Co-operative and Community Development at Co-operative University College of Kenya, said the current state of affairs is diminishing the middle class crucial to an expansive economic growth.
“These inflationary conditions are killing the middle class and yet they are the force behind economic growth.
“We need them to create more jobs for the youth but the conditions are just unfavourable,’’ Gongera, an expert in macroeconomics also, said.
According to him, many companies are restructuring and cutting down on workforce when it should be the vice versa.
“High inflationary rates coupled with huge levels of youth unemployment are great threats to stability of a nation.
“It is a time bomb waiting to explode when we have over 55 per cent of our youth unemployed and they have no economic gain to actively engage in economic development,’’ he said. (Xinhua/NAN)
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