<< Click to Display Table of Contents >> Navigation:  Finance and Economic Planning > CBROP > 2014-15 FY CBROP > RECENT ECONOMIC DEVELOPMENTS AND OUTLOOK > Fiscal Risks to the Outlook

 

The macroeconomic management and performance of most of the sectors at the National level have a ripple effect on how some sectors in the county will perform. The  risks  to  the  outlook  for  2014/15  and  the  medium-term  include continued weak growth in advanced economies that will impact negatively on our exports  and  tourism  activities.  Further, geopolitical uncertainty on the international oil market will slow down the productive sectors of the economy and may increase inflation.

 

The county revenue projections are subject to a number of general risks that can affect collections. These include resistance that may arise from County Finance Bill, 2014, tax evasion and avoidance, weak revenue administrative structures and significant fluctuations in major revenue sources due to changes in the economic environment. These challenges may result in a significant deviation from revenue projections and consequently lead to huge unfunded budget deficits.

 

Other fiscal risks also include potential natural disasters due to unfavorable weather conditions, crop failure due to maize lethal necrosis, terrorist threats causing decline in tourist arrivals and the uncertainties in the release of county funds. Such occurrences have in the past resulted in unexpected increases in expenses which disrupt the planned execution of the budget. Should these risks materialize; the County government in consultation with the National government will undertake appropriate measures to safeguard macroeconomic stability.