Patrick Njoroge, former governor of the Central Bank of Kenya has urged African governments and central banks to improve communicative strategies when implementing new economic policies.
In a recent exclusive interview with Arise TV, he stated that economic policies as solutions to problems are necessary and would inevitably negatively affect some citizens during implementation.
“There has to be economic solutions, and there’ll be variety in terms of who and where gets affected the most, particularly in the case of taxation. The incident of that will probably land on some sectors, or some people more than others.”
“However, we need to go out as central bankers and talk to the people that touch the flesh as it were, not as politicians, but to explain some of the basic things to the population. And it’s amazing that even the ECB and the Bank of England and the Fed have been on this sort of campaign, you know, improving their communication,” he stated.
Read also: How Nigeria, African nations should source for funding – Njoroge
Citing Jamaica as an example, he stated that communicating effectively is important to ease the impact of policies on the people.
“Jamaica, by the way, won a prize for their communication. They actually even had a video explaining why low and stable inflation is important for the economy, you know,” he said.
He also highlighted that African governments need to rationalise expenditures and focus on social issues that impact the people and build social capital.
“It’s not just revenues, it’s also about expenditures, and that has to be rationalised. Here in Nigeria, we used to spend about 2 percent of GDP on subsidies on fuel. Yet, the government was spending less than 1% on health, and education together,” he stated.
He further stated that African economies, while sourcing for funding from various sources, should consider the cheapest and most affordable source of funding to combat liquidity squeeze.
“You need to have the cheapest for this specific project or specific outcome, financially, it has to make sense. Now, what happens is, at times the Minister of Finance is under pressure to fund something, and he doesn’t have enough time to assess whether this is the only potential source of the cheapest in terms of maturity, rates, concessionality,” he said.
