Konza city gets nearly half of ICT industry’s $110 million allocation in Kenya’s 2023 budget

The Kenyan authorities has allotted $110 million for the ICT business. However, nearly half of that quantity will likely be used to develop Konza, a inexperienced city outdoors Nairobi. The authorities can also be targeted on boosting connectivity throughout the nation.

Yesterday, Kenya’s cupboard secretary for treasury, Njuguna Ndung’u, offered the state’s budget for the 2023/2024 monetary 12 months. The complete budget is a whopping KES 3.68 trillion ($26.7 billion), a major enhance from the earlier 12 months’s budget of KES 3.3 trillion ($24 billion). 

Allocations for ICT-related initiatives

According to the cupboard secretary, digitisation and automation can enhance productiveness and competitiveness by making it simpler to entry markets, enhance info circulate, and handle danger. ICT companies may free employees to concentrate on extra inventive and strategic duties. Furthermore, they’ll positively impression youth employment by selling new industries corresponding to music, theatre, graphic design, digital animation, trend, and craft.

A complete of KES 15.1 billion ($109.6 million) has been allotted to fund initiatives in the ICT sector. “To promote productivity and competitiveness, a total of KES 15.1 billion has been allocated to fund initiatives in the ICT sector,” mentioned Ndung’u.

Key allocations embrace KES 4.8 billion ($35 million) for the Horizontal Infrastructure Phase I at Konza City, KES 1.2 billion ($8.7 million) for the Konza information centre and good city amenities, KES 5.7 billion ($41.38 million) for the development of Kenya Advanced Institute of Science and Technology (KAIST) at Konza Technopolis, KES 1.3 billion ($9.4 million) for the upkeep and rehabilitation of the National Optic Fibre Backbone Phase II Expansion Cable, KES 475 million ($3.4 million) for the development of Konza Complex Phase 1 B, and KES 583 million ($4.2 million) for Last Mile County Connectivity Network. These allocations are aimed toward supporting the expansion and improvement of the ICT sector.

Based on these numbers, the federal government will proceed to pump tens of millions into the event of Konza (nearly half the ICT allocation), a sustainable and futuristic city below development on Nairobi’s outskirts. The city has additionally been receiving help from South Korea, which can also be growing KAIST in collaboration with the Kenyan authorities.

The new administration with president Ruto on the helm promised it will be dedicated to increasing digital connectivity. Kenya has made vital progress in this space, however some challenges stay, corresponding to a scarcity of consultants and an ICT infrastructure improvement plan. The authorities has constructed over 9,000 kilometres of terrestrial fibre optic cable and 534 kilometres of last-mile connectivity infrastructure, linking 1,650 public establishments and places of work. By 2030, connectivity will develop considerably, and bandwidth necessities will enhance on account of large information consolidation and analytics.

Other ICT highlights from the 2023 budget

The Central Bank of Kenya (CBK) is collaborating with different businesses and regulators, corresponding to the information safety commissioner’s workplace, to make sure that all digital credit score suppliers are included throughout the regulatory framework. This collective effort goals to safeguard customers and their pursuits. So far, solely 32 digital credit score suppliers have been licensed by the CBK.

Two measures in the digital section have been launched. Firstly, a 5% withholding tax has been imposed on gross funds about digital content material monetisation. Secondly, a digital asset tax has been launched, set at 3% of the worth of digital property transferred or exchanged.

READ MORE: Taxing creativity: Kenyan content material creators pushback in opposition to proposed taxes

Lastly, Kenya plans to facilitate instantaneous retail funds and can launch a appropriate fee platform. This platform will allow seamless transactions throughout banks, fee service suppliers, card schemes, and different regulated monetary establishments. The major objective is to scale back the price of companies, improve choices, competitors, and stability, and encourage the widespread utilization of digital funds among the many Kenyan inhabitants.

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