Tetesi: Kenya Shilling over valued by 17.5% - IMF says

[Kafrican]

IMF just did a desktop evaluation by comparing historical data of imports vs export compaired to currency aprecialtion and devaluation without all the necessary comprehensive data, data which was not provided by GoK ..... quote "the external sustainability approach, it was not possible to use it, as the international investment position data is not yet produced by the authorities,” said IMF "

This means that the 17% depreciation would be the worst case scenario, the external approach is the bechmark for calculation real foreign exchange rate, IMF didnt have all the data ... e.g Foreign remittances by Kenyans abroad have really helped stabilise the shilling....



In any case, If the shilling depreciates that much,You can expect the Kenyan GDP growth rate to rise to like 8-10% growth rate like it was the case with TZ when Tsh depreciated significantly as everything produced locally will be super cheap while imports will become expensive cutting back on importation spending...

 

[kennedy0000]

😂😂😂😂😂View attachment 911670View attachment 911671

Lol. Utapika mpaka data za Wikipedia. Si you just take the whole screenshot, sio tu section yenye TZ iko mbele ya Kenya. 2 sources wanasema GDP PPP yetu iko juu. Only one says Tanzania is ahead.

Also, this is not GDP per Capita.
GDP per capita shows the average income of the people. Kumaanisha income ya Mkenya ni almost double ya Mtanzania. Same case na Zambia.
Alafu, this is the most important chart. Umaskini ulivyo Tanzania.

 

[pingli-nywee]

Kama hujuwi historia ndio utabaki kujiuliza kwananini shiling ya Tanzania imefika hapo.

Historia ipi kwani KES ilidondoka kutoka mbinguni? 1US$= 2290tzshs!, na bado mpo hapa mnajipiga vifua mkimaga udenda kwasababu ya KES? Mli'overvalue' tzs kwa 17% miaka michache iliyopita lakini bado ikazidi kudorora tu. Ona walivyosema IMF. http://www.thecitizen.co.tz/News/Ta...d--says-IMF/1840340-2894824-oh8m04/index.html

 

[kennedy0000]

And you believe and think we was $31B in 2010 and we depreciated to $25B in 2017 with all these booming economy signs i see everywhere. Keep on consoling youself.

Wewe unajua kusoma kweli?
Who has said you depreciated to $25?

You were $31 in 2010. You grew to $52 in 2017.

Gap between Kenya and Tanzania is the one that expanded to $25.

 

[kennedy0000]

They've already realise it was mistake to let that happen and become dependable to emerging countries, now they're all fighting back.

Boss. Tanzania is just poor. No excuse.
You don't produce any petroleum, but you import very little.
Meaning you have very few cars on the roads. And you have very few factories.

 

[Mkikuyu- Akili timamu]

IMF just did a desktop evaluation by comparing historical data of imports vs export compaired to currency aprecialtion and devaluation without all the necessary comprehensive data, data which was not provided by GoK ..... quote "the external sustainability approach, it was not possible to use it, as the international investment position data is not yet produced by the authorities,” said IMF "

This means that the 17% depreciation would be the worst case scenario, the external approach is the bechmark for calculation real foreign exchange rate, IMF didnt have all the data ... e.g Foreign remittances by Kenyans abroad have really helped stabilise the shilling....



In any case, If the shilling depreciates that much,You can expect the Kenyan GDP growth rate to rise to like 8-10% growth rate like it was the case with TZ when Tsh depreciated significantly as everything produced locally will be super cheap while imports will become expensive cutting back on importation spending...


View attachment 911681

Zero..Despite not having economics knowledge, you dont know how to Google.
Its an open secret why Kenya is over valuing its Currency.."Dollar Denominated" Debt..
Should the ksh drop by 17.5%, Intrest payable in $ as well as principal immediately rises by 17.5%..
IMF is not stupid, they know whats going on and who is trying to hide their nakedness..Fortunately you cant cheat the system for long..You will run out of borrowed $$ for proping up the currency, and thats why IMF degraded the credit worthness of kenya..Its only going to be more expensive to borrow $ meant for hinding the bare nakedness

 

[Mwanzi1]

Also, the less you import the less your purchasing power. Tumia logic.
If the reason you are not importing cars is because you manufacture them, we can understand. But for you, the reason you are not importing cars is because you cannot afford them. Plain and simple.

And for your info., these major powers are also net importers, just like Kenya.

USA
UK
Canada
France
India
UAE
Netherlands
Spain
Portugal
Ukraine
Denmark

Apart from China, Japan, Germany and a few others you find only the oil producers exporting more than they import.

Countries strive to export more, not import less.

We don't import unnecessary goods, in fact we've cut down to the core wastage. Bring the numbers of imported commercial vehicles in Kenya and Tanzania.

Clearly you haven't been following what Trump has been preaching for the last two years. The number of jobs when have been exported from USA, France UK etc to China is unimaginable. Those countries as you call them NET IMPORTERS, are starting to bring those jobs back while a Kenyan is bragging his so good on using IMF and World Bank money in wasteful way.

 

[Mwanzi1]

Historia ipi kwani KES ilidondoka kutoka mbinguni? 1US$= 2290tzshs!, na bado mpo hapa mnajipiga vifua mkimaga udenda kwasababu ya KES? Mli'overvalue' tzs kwa 17% miaka michache iliyopita lakini bado ikazidi kudorora tu. Ona walivyosema IMF. http://www.thecitizen.co.tz/News/Ta...d--says-IMF/1840340-2894824-oh8m04/index.html

Kshs ilibebwa na UK, USA kwa muda mrefu sana wakati Tanzania tulikuwa tunaminya na kuchapwa na hao hao UK USA. Sasa hivi tumejipanga hali kidogo iko imara. Nikulize hiyo Tshs imecheza maoneo hayo 2000-2300 kwa miaka mingapi sasa?

 

[Mwanzi1]

Boss. Tanzania is just poor. No excuse.
You don't produce any petroleum, but you import very little.
Meaning you have very few cars on the roads. And you have very few factories.

The same cars Quest is frying you with. You import with someone else money not yours. Your living on expensive credit card, if you want to know how rich your are, payback your credit card bill first.

 

[Kafrican]

For those who know economics, lets evaluate the true value of kenya GDP
100%-17.5% = 82.5%
GDP Current prices 2017 was $74bn
Now GDP Current prices 2017 with currency over valuation removed (82.5% of $74bn) = $61.5bn.
And when you apply this to GNI and GDP per Capita, Kenya enters the league of LDC.

NB: Dont argue here with propaganda and usual jubilee tribalism. The IMF has SPOKEN

Lets assume for a second that it happens and the KES depreciates by 17% after all the data and calculation is done...... The math wouldn't be as simple as what you have done up there...
It would mean a recalculation of the whole GDP from scratch beginning next year .... Exports will be added advantage while imports will hurt...
E.g Using the same concept you have used up there , Tourism, foreign remitence, Flower exports, tea exports, fresh produce, cooking oils exports will earn 17% more if they export the same exact quantity they did last year...... on the other hand, importation will be affected in two ways 1. Imports will be 17% more expensive 2. This will mean a cut back in importation which might actually work in favor of Kenyas negative trade balance..
So the GDP will not automatically fall by 17%, it will all depend on those factors, and since the depreciation will not be as a result of market forces, you will find that the positive effects of the local market will cause the shilling to appreciated rapidly one or two year later back to the same level

 

[eliakeem]

SI unit ndio unamaanisha nini? Ama huelewi hio formula usaidiwe?

GDP = sum of all goods and services in a country.

Ahaaa haaa haaa
I'm not interested in formulae.
If you don't understand the meaning of SI UNIT consult prof Google as Mkikuyu- Akili timamu advised you.

 

[pingli-nywee]

Kshs ilibebwa na UK, USA kwa muda mrefu sana wakati Tanzania tulikuwa tunaminya na kuchapwa na hao hao UK USA. Sasa hivi tumejipanga hali kidogo iko imara. Nikulize hiyo Tshs imecheza maoneo hayo 2000-2300 kwa miaka mingapi sasa?

Nilijua tu utajitia hamnazo kuhusu hizo habari hapo za IMF na mlivyo'overvalue' tzshs kwa 17%. Bure kabisa, eti tzshs ilikuwa inapambana na $ wakati KES ikibebwa nayo! [emoji15]

 

[Kafrican]

Zero..Despite not having economics knowledge, you dont know how to Google.
Its an open secret why Kenya is over valuing its Currency.."Dollar Denominated" Debt..
Should the ksh drop by 17.5%, Intrest payable in $ as well as principal immediately rises by 17.5%..
IMF is not stupid, they know whats going on and who is trying to hide their nakedness..Fortunately you cant cheat the system for long..You will run out of borrowed $$ for proping up the currency, and thats why IMF degraded the credit worthness of kenya..Its only going to be more expensive to borrow $ meant for hinding the bare nakedness

In my comment, I never talked about debt, I only talked about its effect on the GDP

 

[Mkikuyu- Akili timamu]

Lets assume for a second that it happens and the KES depreciates by 17% after all the data and calculation is done...... The math wouldn't be as simple as what you have done up there...
It would mean a recalculation of the whole GDP from scratch beginning next year .... Exports will be added advantage while imports will hurt...
E.g Using the same concept you have used up there , Tourism, foreign remitence, Flower exports, tea exports, fresh produce, cooking oils exports will earn 17% more if they export the same exact quantity they did last year...... on the other hand, importation will be affected in two ways 1. Imports will be 17% more expensive 2. This will mean a cut back in importation which might actually work in favor of Kenyas negative trade balance..
So the GDP will not automatically fall by 17%, it will all depend on those factors, and since the depreciation will not be as a result of market forces, you will find that the positive effects of the local market will cause the shilling to appreciated rapidly one or two year later back to the same level

Hehehe Voodoo Economics. Boss GDP Data is based on USD simple..Apply 17.5% Depreciation on both imports and exports the effect is uniform.
The problem is if you apply 17.5% currecy depreciation on the huge Budget defeciate in 2017 which was actually filled with Eurobond..
Let me educate you, the current $57bn loans are actualy worth $67bn or in the infamous and mostly least understood Debt to GDP ratio 89%

 

[Mkikuyu- Akili timamu]

In my comment, I never talked about debt, I only talked about its effect on the GDP

Then that means you are a rabbit head. You dont understand how ForeX affects debt and debt repayments. You just use google to flash out useless figures that you dont comprehend..Like your favourite Number of millionares in kenya 😀 SMH

 

[Mwanzi1]

Nilijua tu utajitia hamnazo kuhusu hizo habari hapo za IMF na mlivyo'overvalue' tzshs kwa 17%. Bure kabisa, eti tzshs ilikuwa inapambana na $ wakati KES ikibebwa nayo! [emoji15]

Kwani mlikuwa hamna masoko ya bidhaa za Kenya nje?, FDI iliyokua inakuja Kenya in 70's, 80's hata 90's ilikuwa sawa na iliyokuwa unakuja Tanzania?

 

[eliakeem]

Lets assume for a second that it happens and the KES depreciates by 17% after all the data and calculation is done...... The math wouldn't be as simple as what you have done up there...
It would mean a recalculation of the whole GDP from scratch beginning next year .... Exports will be added advantage while imports will hurt...
E.g Using the same concept you have used up there , Tourism, foreign remitence, Flower exports, tea exports, fresh produce, cooking oils exports will earn 17% more if they export the same exact quantity they did last year...... on the other hand, importation will be affected in two ways 1. Imports will be 17% more expensive 2. This will mean a cut back in importation which might actually work in favor of Kenyas negative trade balance..
So the GDP will not automatically fall by 17%, it will all depend on those factors, and since the depreciation will not be as a result of market forces, you will find that the positive effects of the local market will cause the shilling to appreciated rapidly one or two year later back to the same level

Teh teh teh tihiii
your assumptions does not hold water and reworking the entire contents of the GDP won't change anything.

look here

Y = C + I + G + (X – M)
if you multiply by 17%
it will be

17% × Y = 17% × (C + I + G + (X - M))
= 17% × C + 17% × I + 17% × G + (17% × X - 17% × M)

basically to work with the details will not change the final result.

 

[Tony254]

Nimechelewa kuingia kwenye hii thread. Naona watanzania wamejaa wakimwaga upupu. It is too late, wacha niwaache waendelee kuongea

 

[pingli-nywee]

Teh teh teh tihiii
lete thread yake tujadili.
but in here we are talking about currency valuation.
Ahaaa haaa haaa

Ndio hizi hapa habari za overvaluation ya tzshs kwa 17% miaka mitatu iliyopita. http://www.thecitizen.co.tz/News/Ta...d--says-IMF/1840340-2894824-oh8m04/index.html Yaani mouth to mouth iliyofanywa ili kuiokoa tzshs iliambulia patupu, runaway currency hiyo, haisikii dawa wala kichapo, ipo ipo tu. [emoji1][emoji1][emoji1]

 

[Tony254]

Ningekuwa humu wakati hii thread inaanza, hii thread haingepita kurasa tatu. Watu ambao hawajui uchumi wamejaa humu wakiongea mambo yasioeleweka.