The Kenya Government has set aside Kshs 3 billion as see d capital to establish a revolving fund to finance small and medium scale enterp r ises in the country this financial year, President Mwai Kibaki has said.
Kibaki, who Friday launched the third Kenya Commercial Bank (KCB) Rights Issue a t the KCB Leadership Centre, Karen, in Nairobi, observed that the fund would ena b le a significant proportion of Kenyans, particularly in the informal and small a n d medium scale enterprises, access financial services.
In this regard, the Head of State urged banks and other financial institutions t o support the noble initiative by providing a minimum of five shillings for ever y one shilling contributed by the government.
Contribution from the banks, the President said, will enable the government real ize a minimum of Kshs 15 billion (US$ 1 = 76 Kenya shillings) initial capital fo r the fund.
“The small and medium scale sector is critical to the prosperity of the country’ s economy as it forms the nucleus upon which the success of Vision 2030 will be f ounded,” Kibaki noted.
The President assured Kenyans that the government would continue to implement re form initiatives aimed at expanding the financial resources available to this se c tor.
Emphasizing the importance of finance as an engine for economic development, the Head of State said that the Vision 2030 placed the financial sector at the hear t of mobilising the resources required to achieve the country’s development agend a .
The President stressed the importance of strong and highly capitalised banks cap able of mobilising substantial resources needed to roll out large scale investme n t projects necessary in creating the much needed wealth to uplift the living sta n dards of Kenyans.
He affirmed the government’s commitment in pursuing policies that will lead to l ower interest rates, noting that cheaper credit will spur economic growth and he l p create more jobs for Kenyans.
On the East African Common Market protocol which came into effect Thursday, he u rged Kenyans and fellow East Africans to take advantage of the opportunities bro u ght about with the integration of the East African Community to improve on their
The President commended the bank for extending its services to Uganda, Tanzania, Rwanda and Southern Sudan, which he noted would go a long way in providing an i n tegrated banking service across the region and urged other financial players to v enture into the East African capital market.
The Head of State said he was optimistic the Common Market Protocol would enable the region realize its goals of creating the most successful and integrated eco n omic bloc in Africa.
Through the rights issues, KCB intends to mobilize an additional Kshs 15 billion to support the growth of its business operations in Kenya and the East African R egion.
Speaking during the occasion, Deputy Prime Minister and Minister for Finance Uhu ru Kenyatta pointed out that the government recognized the role played by the fi n ancial sector in driving the growth of the country’s economy.
On youth empowerment, the Finance Minister said the government was committed to developing programmes intended to empower and liberate the youth from poverty.