It’s important to reflect on how Kenya fared in the past 12 months as we look ahead into 2025 to see where we can do better. The nation faced a range of significant political and economic challenges.

On the economic front, we endured high inflation and living costs, with food prices a particular concern, especially for low-income households. The shilling depreciated significantly against major currencies. This made imports more expensive, affecting the prices of petroleum products and essential food items like cooking oil.

Kenya also carries a heavy external debt burden, with estimates showing that it stood at over $45 billion (about Sh6 trillion) as of July. As the shilling weakened, our dollar-denominated debt became more expensive to service. This put additional pressure on government finances and foreign exchange reserves.

Another key issue was the implementation of the housing levy, which was introduced in 2023. The levy was part of the government’s Affordable Housing Programme.

The proposal faced several significant legal challenges. Opponents argued that the levy was unconstitutional, citing a lack of proper public participation. Questions were also raised about the mandatory nature of the deductions. In November 2023, the High Court declared the levy unconstitutional.

But the government was granted a temporary stay to continue collecting the levy pending appeal. MPs amended and approved a related bill in March 2024 and President Ruto signed it into law.

In the political arena, tensions grew between President Ruto’s government and opposition leader Raila Odinga, while protests led by young Kenyans erupted in June over economic conditions, tax proposals in the 2024 Finance Bill, and governance issues. In response, Ruto withdrew the bill and later co-opted members of Raila’s ODM party into what he called a broad-based government.

Based on the challenges we have faced over the past year, there are key strategies that could help stabilise and strengthen the nation in 2025.

The first is stabilising the economy. We hope that Ruto and his allies have learned that tax reforms should be implemented gradually, rather than suddenly, so as to avoid shocking the economy.

To earn more foreign exchange, we should focus on expanding export markets beyond traditional partners. We should also develop our manufacturing capacity to reduce dependence on imports, restructure our national debt to secure more favourable terms and reduce debt servicing pressure, and strengthen agricultural resilience through irrigation projects and climate-smart farming to improve food security.

On political reforms, we need to create more structured dialogue mechanisms between the government and opposition forces in order to prevent street protests of the kind we saw in June and July. We should enhance transparency in implementing public projects, particularly for major initiatives like housing. We also need to improve public communication around policy changes to build better understanding and buy-in from citizens. We look forward to a more stable and prosperous Kenya in 2025