APRM • SECOND COUNTRY REVIEW REPORT OF THE REPUBLIC OF KENYA 4.3.2 Findings of the Country Review Mission 4.3.2.1 Progress made since 2006 (i) 303. The government has made laudable progress. It formulated and launched the Kenya Vision 2030 in 2008, which is both a long-term vision and strategy, for attaining sustained socioeconomic development. Vision 2030 replaced the Economic Recovery Strategy for Wealth and Employment Creation (ERS), which Kenya implemented since 2002. The Vision aspires to turn Kenya into a globally competitive and prosperous nation within 25 years, between 2008 and 2030, and attain a high standard of living for its people. Under the economic pillar of the Vision, the aspiration is to attain and sustain economic growth rates of 10% starting in 2012 through implementing an economic development programme that prioritizes key growth sectors of the economy. The key growth stimulating sectors to drive the ambitious 10% economic growth rates per annum are tourism, agriculture, manufacturing, wholesale and retail trade, business process offshoring (BPO) and financial services. Attaining and sustaining macroeconomic stability and infrastructure development are recognized as the growth enablers. (ii) 304. Medium-Term Plans Delivery of the Vision is through a series of 5-year Medium Terms Plans (MTPs), designed to link policy objectives to their implementation and allocation of resources. The first MediumTerm Plan (MTP-I) was implemented for the period 2008-2012. It focused on addressing the development constraints experienced under the ERS. It emphasized (i) fast job creation; (ii) poverty reduction; (iii) improved income distribution; and (iv) related themes of regional inequality, youth and gender. The second MTP (MTP-II) covers the period 2013-2017 and is currently being implemented. It seeks to build on the progress achieved under the MTP-I. (iii) 305. Kenya Vision 2030 Economic policy The economic policy framework is aligned with the goals of the MTPs and reflects the government’s plans to deliver socioeconomic development through high growth rates over the period of the MTP. Attaining macroeconomic stability is recognized as a key enabler of achieving the goals of the plans. Therefore, the design and setup of macroeconomic policy is appropriately directed at achieving and sustaining macroeconomic stability. In this regard, monetary policy is tasked to deliver price stability and promote financial system stability, which should anchor the long-term growth of the economy. To that end, the Central Bank of Kenya is continuing efforts to modernize the monetary policy framework to lay the ground work for transition to a full- fledged inflation targeting regime in order to anchor inflation expectations more directly. The sectoral objectives are to be achieved through a range of sectoral policies covering each of the six key sectors, supported by a fiscal policy framework that allocates resources in line with the policy objectives. In particular, the fiscal | 140 |