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The happiness levels of Kenyans experienced a downturn in 2023 for the first time in five years, as per the World Happiness Report 2024.
Ranking 114 out of 143 countries, Kenya dropped three places from the previous year. Young people ranked highest in happiness, while the upper middle-aged group reported the lowest levels of unhappiness.
Nevertheless, Kenya outpaced neighbouring countries like Uganda and Tanzania in the happiness index. Finland continued to hold the top rank as the happiest nation in the world for the seventh consecutive year.
Economic challenges, including inflation and new taxes, are seen to have contributed to household frustrations, although the study didn't specify reasons for the decline in happiness.
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Increased deductions to the National Social Security Fund and the imposition of a housing levy added to economic strain, reflecting broader concerns about financial stability and quality of life.
1. Finland
2. Denmark
3. Iceland
4. Sweden
5. Israel
6. Netherlands
7. Norway
8. Luxembourg
9. Switzerland
10. Australia
11. New Zealand
12. Costa Rica
13. Kuwait
14. Austria
15. Canada
16. Belgium
17. Ireland
18. Czech Republic
19. Lithuania
20. United Kingdom
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The Parliamentary Budget Office (PBO) has warned that Kenya's tax revenue is likely to fall short by Ksh330 billion, attributed to underperformance since July 2023 when the Finance Act, 2023, came into effect.
In the first eight months of the 2023/24 financial year, KRA has collected 55% of the Ksh2.49 trillion target leaving the authority in a race to gather Ksh1.12 trillion in just four months.
This shortfall, 13.2% of the annual target, could hinder funding for critical development projects and job creation efforts. Factors contributing to the revenue decline include increased taxation, such as doubling VAT on fuel, and reduced expenditure on development projects due to fiscal constraints.
To offset deficits, the government plans significant borrowing, with Ksh1.7 trillion targeted from local and foreign markets.
Meanwhile, KRA reports show it has succeeded in averting tax losses via seizure of illicit goods worth over Ksh2 billion through extensive operations targeting items such as alcohol and cigarettes.
Read Also: KRA Urges Kenyans to Take Advantage of Tax Amnesty Window
Despite being ranked among places with a weak business environment, Kenya shows potential for improvement according to the Economist Intelligence Unit (EIU).
The report ranks Kenya at sixth position among the most improving geographies in the business environment between 2019 and 2023, driven largely by investments in infrastructure and the passage of the Privatisation Act in 2023.
The government has been implementing significant fiscal policy changes aimed at narrowing the fiscal deficit and stimulating economic growth. The World Bank projects a 5.2% growth rate for Kenya's economy in 2024.
On a global scale, Singapore, Denmark, and the US are predicted to have the best business environments over the next five years, with advanced economies dominating the top ten. Meanwhile, Venezuela remains the worst country to do business despite slight improvements following its economic collapse.
Kenya accounted for 14% of total venture capital deals in 2023, valued at Ksh83.8 billion, trailing South Africa and Nigeria.
Nigeria leads with 19% of deal volume, followed by South Africa at 18%. Egypt closes out the “Big 4” with 11% of the deal volume.
Morocco is gradually emerging as a significant player with 24 deals worth $17 million or 4% of the deal volume. Funding challenges have been forcing some startups to downscale or shut down, leading to over 1,000 job cuts across Africa.
Despite challenges, Africa remains important for venture capital investors, particularly in Fintech and IT sectors. Survival strategies include scaling down operations to prioritise profit.
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