The East African region risks missing its long-term economic growth targets due to a widening disconnect between the labour market and the skills of graduates from institutions of higher learning, according to a World Bank 2017 report.
This is despite heavy investment by East African countries – in skills development, and public expenditure on education, which absorbs about 15 per cent of total public spending and nearly five per cent of gross domestic product.
The report paints a grim picture of the availability of employable skills especially for industry such as technical mastery and artisanship. Businesses in most countries often point to the failure of education and training systems to provide the skills they need.
There is often a mismatch between skills supplied and skills demanded in the labor market. Industries that understand their current, immediate and future needs and those able to identify the opportunities presented by the ever-changing market place, will be best placed to capture the best skills in the pool.
Today, new technologies, higher quality standards in world markets, flexible production processes, the pressure of global competition, the emergence of e-commerce and Industry 4.0 mean that the skill level for gaining and maintaining a competitive edge in businesses and industries is rising continuously.
Investment in skill development played a very important role in the Asian Tiger economies and the earlier miracles in the development of the Japanese and North American economies. Kenya must create an enabling environment that accelerates our socio-economic development through productivity enhancement.
The primary strategy towards this end would be the development of our human resources to achieve a multiplier effect that will expedite economic reforms.
Globally, several countries such as Finland Germany, Switzerland, Austria and Netherlands, have taken steps to strengthen policy guidance and regulatory frameworks for technical and vocational education and training.
This has also enabled them tackle youth unemployment.In Kenya, the government has in its budget for 2018/2019 financial year, allocated Sh444.1 billion towards education, with a focus on expansion of Technical and Vocation, Education and Training (TVET) infrastructure.
This illustrates government’s commitment towards the provision of quality and relevant education and training.
Kenya Association of Manufacturers (KAM) has for two years now, partnered with the Germany Technical Cooperation (GIZ) in the TVET programme. The programme seeks to influence the policy direction regarding technical training towards demand-driven technical education in Kenya.
For our nation to realise Vision 2030, there has to be a focused attention towards building the human capital that will drive the industries through skills development. Primarily, the manufacturing sector is the guaranteed provider of productive, sustainable jobs.
We cannot solve the unemployment menace in the country with rudimentary skills; we must secure the future of industry through practical cutting-edge skills for job creation.
Research by UNESCO reveals that, sub-Saharan Africa has the highest rates of education exclusion. Over one-fifth of children between the ages of about 6 and 11 are out of school, followed by one-third of youth between the ages of about 12 and 14. There is need therefore for young people in the region to discard the notion, that vocational education is an inferior education option. Vocational training is a sure way for developing nations to industrialize at a faster rate. Developing countries could minimize skills mismatches by placing greater emphasis on TVET.Human Capital is one of the biggest investments of any industry. It is important that skills development and other investments comprise one of the factors necessary for productivity and growth. Continued improvement of productivity is also a condition for competitiveness and economic growth and therefore poverty reduction. As a country, we indeed face the possibility of a ‘skill divide’, which will be even more threatening to our development prospects than the ‘digital divide’.
Joyce Njogu, head of consulting, Kenya Association of Manufacturers.
World Bank pushes G-20 to extend debt relief to 2021
World Bank Group President David Malpass has urged the Group of 20 rich countries to extend the time frame of the Debt Service Suspension Initiative(DSSI) through the end of 2021, calling it one of the key factors in strengthening global recovery.
“I urge you to extend the time frame of the DSSI through the end of 2021 and commit to giving the initiative as broad a scope as possible,” said Malpass.
He made these remarks at last week’s virtual G20 Finance Ministers and Central Bank Governors Meeting.
The World Bank Chief said the COVID-19 pandemic has triggered the deepest global recession in decades and what may turn out to be one of the most unequal in terms of impact.
People in developing countries are particularly hard hit by capital outflows, declines in remittances, the collapse of informal labor markets, and social safety nets that are much less robust than in the advanced economies.
For the poorest countries, poverty is rising rapidly, median incomes are falling and growth is deeply negative.
Debt burdens, already unsustainable for many countries, are rising to crisis levels.
“The situation in developing countries is increasingly desperate. Time is short. We need to take action quickly on debt suspension, debt reduction, debt resolution mechanisms and debt transparency,” said Malpass.
Kenya’s Central Bank Drafts New Laws to Regulate Non-Bank Digital Loans
The Central Bank of Kenya (CBK) will regulate interest rates charged on mobile loans by digital lending platforms if amendments on the Central bank of Kenya Act pass to law. The amendments will require digital lenders to seek approval from CBK before launching new products or changing interest rates on loans among other charges, just like commercial banks.
“The principal objective of this bill is to amend the Central bank of Kenya Act to regulate the conduct of providers of digital financial products and services,” reads a notice on the bill. “CBK will have an obligation of ensuring that there is fair and non-discriminatory marketplace access to credit.”
According to Business Daily, the legislation will also enable the Central Bank to monitor non-performing loans, capping the limit at not twice the amount of the defaulted loan while protecting consumers from predatory lending by digital loan platforms.
Tighter Reins on Platforms for Mobile Loans
The legislation will boost efforts to protect customers, building upon a previous gazette notice that blocked lenders from blacklisting non-performing loans below Ksh 1000. The CBK also withdrew submissions of unregulated mobile loan platforms into Credit Reference Bureau. The withdrawal came after complaints of misuse over data in the Credit Information Sharing (CIS) System available for lenders.
Last year, Kenya had over 49 platforms providing mobile loans, taking advantage of regulation gaps to charge obscene rates as high as 150% a year. While most platforms allow borrowers to prepay within a month, creditors still pay the full amount plus interest.
Amendments in the CBK Act will help shield consumers from high-interest rates as well as offer transparency on terms of digital loans.
Scope Markets Kenya customers to have instant access to global financial markets
NAIROBI, Kenya, Jul 20 – Clients trading through the Scope Markets Kenya trading platform will get instant access to global financial markets and wider investment options.
This follows the launch of a new Scope Markets app, available on both the Google PlayStore and IOS Apple Store.
The Scope Markets app offers clients over 500 investment opportunities across global financial markets.
The Scope Markets app has a brand new user interface that is very user friendly, following feedback from customers.
The application offers real-time quotes; newsfeeds; research facilities, and a chat feature which enables a customer to make direct contact with the Customer Service Team during trading days (Monday to Friday).
The platform also offers an enhanced client interface including catering for those who trade at night.
The client will get instant access to several asset classes in the global financial markets including; Single Stocks CFDs (US, UK, EU) such as Facebook, Amazon, Apple, Netflix and Google, BP, Carrefour; Indices (Nasdaq, FTSE UK), Metals (Gold, Silver); Currencies (60+ Pairs), Commodities (Oil, Natural Gas).
The launch is part of Scope Markets Kenya strategy of enriching the customer experience while offering clients access to global trading opportunities.
Scope Markets Kenya CEO, Kevin Ng’ang’a observed, “the Sope Markets app is very easy to use especially when executing trades. Customers are at the heart of everything we do. We designed the Scope Markets app with the customer experience in mind as we seek to respond to feedback from our customers.”
He added that enhancing the client experience builds upon the robust trading platform, Meta Trader 5, unveiled in 2019, enabling Scope Markets Kenya to broaden the asset classes available on the trading platform.