Central Bank Governor Kamau Thugge is under fire from the Finance Committee of the National Assembly for giving a Sh14 billion contract to print two billion banknotes to a German company. But it is a sensible decision.
This contract is $3 million cheaper than the last contract with De La Rue in 2019. It is costing approximately five US cents to print each note which will have more security features than the old notes printed in Kenya. Sh14 billion sounds a lot but a shortage of banknotes can slow down the whole economy.
In 2019, government bought 40 per cent of De La Rue in Kenya for Sh660 million but it continued to make losses. In 2023, De La Rue closed its Kenya factory after the KRA taxed its transfer of revenue to the UK. So the government investment was a write-off. That's what the Finance Committee should investigate.
There are only about six companies in the world that can reliably print banknotes. The Central Bank contacted the key players so it was a competitive tender.
Kenya needs new banknotes and the German company is a reliable supplier.
Quote of the day: "For 40 years, I have not been the ruler - the authority has been with the people. They take nothing from me or add anything to me."
Muammar Gaddafi
The Libyan leader was overthrown on August 23, 2011