Kenya protests soaring cost of living

 

Kenyans are experiencing the effects of both capitalism and the futility of trusting in ‘leaders’. The soaring cost of living has led to protests with extreme violence resulting, according to the United Nations human Rights Office, in protesters deaths and injuries. To protect its power, and those of the asset owning class, the State will always initially resort to those members of the working class who have undertaken to defend bourgeoisie interests even to the extent of beating and shooting fellow workers.

‘Kenyan opposition leader Raila Odinga has called for three days of anti-government protests starting on Wednesday.

The latest demonstrations are against tax hikes and follow two previous sets of protests this year against the soaring cost of living in East Africa’s economic hub and alleged malpractice in last year’s presidential election, which Odinga lost.

The new taxes were to take effect on July 1, but a Nairobi court halted their implementation pending further legal proceedings. Still, a tax increase on petroleum products was imposed, increasing fuel costs.

Odinga said more protests could be held after this week.

What are the latest protests about?

Odinga announced the protests on June 14 against a new finance bill, which introduced a 1.5 percent housing levy, a 16 percent tax on petroleum products and a 16 percent value-added tax (VAT) on money that policyholders receive as compensation from insurance companies.

“That finance bill will be the last nail in the coffin,” Odinga told his supporters. “If it is passed, it will make Kenyans slaves of paying taxes. …When they pass that bill, that will be the trumpet call. Will you be ready?”

The bill was signed into law on June 26.

On July 10, Kenya’s High Court extended an order barring Treasury Cabinet Secretary Njuguna Ndung’u from implementing it.

The government mostly obeyed the ruling except for the Energy and Petroleum Regulatory Authority, which increased fuel prices, triggering an increase in public transport costs.

The price increases are from 182.04 shillings ($1.29) to 195.53 shillings ($1.38) per litre of petrol, 164.28 shillings ($1.16) to 176.67 shillings ($1.25) for a litre of diesel and from 161.48 shillings ($1.14) to 173.44 shillings ($1.22) per litre of kerosene.

What is the finance act about? 

During the presidential campaign,the eventual winner, William Ruto, promised to reduce the cost of living and positioned himself as a poor “hustler” eager to wrest power away from the ruling dynasties that President Uhuru Kenyatta and Odinga, sons of independent Kenya’s first president and vice president, represented. The younger Kenyatta endorsed the younger Odinga rather than his deputy, but Ruto was declared the winner and was sworn into office in September. President Ruto inherited an enormous government debt. At the time Kenyatta took office in 2013, it stood at 1.79 trillion shillings ($13bn). By the time Kenyatta left office, it had ballooned to 8.7 trillion shillings ($61bn).

Ruto then removed fuel subsidies, leading to a spike in the prices of basic commodities like bread and maize flour, which are directly affected by the cost of energy and transport.“In addition to being very costly, consumption subsidy interventions are prone to abuse, they distort markets and create uncertainty, including artificial shortages of the very products being subsidised,” he said in his inauguration speech.

New taxes followed. In addition to the housing levy, petroleum products tax and insurance compensation tax, digital assets taxes were also introduced. The government also imposed a 3 percent levy on transfer charges applied during the exchange of assets that cover non-fungible tokens (NFTs), cryptocurrencies, and digital currencies.

The finance act also introduced a 15 percent withholding tax for digital content creators, a 35 percent tax for people earning above 500,000 shillings ($3,536) annually and the VAT on petroleum products was increased from 8 percent to 16 percent.

According to economists, the law will increase tax revenues collected from high-income earners while shrinking individual net income for low-income earners because of increased tax burdens.

What have the effects of the protests been?

According to a statement by a spokesman for the United Nations Human Rights Office, up to 23 people were killed by the police and dozens were injured in demonstrations in the past week. A couple of opposition members were also arrested.

“The UN is very concerned by the widespread violence and allegations of disproportionate use of force, including the use of firearms by the police during protests in Kenya,” Jeremy Laurence said. “We call for prompt, thorough, independent and transparent investigations into the deaths and injuries.

”What happens next? 

Thousands of opposition supporters have protested in Nairobi and a number of other cities on back-to-back Mondays and Thursdays despite a strong pushback from law enforcement, so massive numbers are expected for the protests this week’.

https://www.aljazeeracom/news/2023/7/18/kenya-braces-for-3-days-of-anti-govt-protest-all-the-details

Expensive Angola

Sub-Saharan Africa’s second-largest oil producer, Angola’s capital Luanda already ranks as the world’s most expensive city for expatriates, with the presence of thousands of foreign workers, many involved in the oil industry, helping to drive up prices.

In Luanda’s Jumbo supermarket, a half-litre tub of imported vanilla ice-cream used to cost $25 (£15), testament to the Angolan capital’s rank as one of the world’s most expensive cities.
With new import tariffs imposed last month, that price has jumped to $31, enough to make even wealthy locals and expatriates pause and putting the treat even further beyond the reach of millions of poor Angolans struggling to feed their families. Angola imports three quarters of the goods it consumes.  The south-west African nation’s agriculture and industry are relatively undeveloped. They make up 17 percent of gross domestic product, compared with oil’s 41 percent.

“The tariff increases will create inflation, at least in the short term, and affect consumption, especially for those with low incomes,” says Salim Valimamade, an economist at Luanda’s Catholic University. Shopkeepers say the import tariff hikes have forced them to hike prices by up to 20 percent.

Dos Santos, one of Africa’s longest-ruling leaders, has been accused by critics of widening a dangerous gap between the rich and the poor that risks causing social unrest.  Santos estimated last year that 36 percent of Angola’s 18 million people live in poverty, but dismissed the risk of income inequalities causing social upheaval, saying most people supported the government’s policies.

The UN High Commissioner for Human Rights, Navi Pillay, had a different view, urging Mr Dos Santos to reduce the inequality gap and warning about the high cost of living.

The average national salary in 2010, the latest year for which official data is available, was around $260 per month. In the finance sector the average was 10 times higher and in the oil business over 20 times higher, or around $5,400.