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Governor of the Central Bank of Kenya (CBK) Dr. Kamau Thugge has been honoured with the prestigious title of Central Bank Governor of the Year by the African Banker Magazine.
- Dr. Kamau Thugge honored with Central Bank Governor of the Year title by African Banker Magazine
- Recognition attributed to Thugge's exceptional leadership and Kenya's resilient banking sector
- Thugge praised for stabilizing Kenyan shilling and instilling confidence despite economic challenges
This recognition comes as a testament to Dr. Thugge’s exceptional leadership and the resilience of Kenya’s banking sector.
The African Banker Magazine praised Thugge for his ability to stabilise the Kenyan shilling and instill confidence in the Kenyan economy despite economic and geopolitical turmoil.
“During your tenure in office, you have successfully stabilised markets and instilled confidence in the Kenyan economy,” the citation read.
It further commended the Kenyan banking sector’s remarkable resilience and its positioning as a true regional leader.
The awards committee also acknowledged Thugge’s recent achievements as Central Bank Governor, noting the strategic role played by the CBK in addressing market failures and stimulating growth.
During his acceptance speech at the Mariott Hotel in Nairobi, Dr. Thugge expressed deep gratitude for the recognition and highlighted the collaborative efforts that led to this accolade.
He acknowledged the support from the CBK Board, the Monetary Policy Committee, management, and staff, as well as the leadership provided by President William Ruto.
Dr. Thugge’s speech detailed the challenging economic conditions that marked the beginning of his tenure in June 2023.
The Kenyan economy faced multiple shocks, including surges in global energy and food prices, adverse climate factors, and a dysfunctional interbank foreign exchange market.
These issues had resulted in high inflation and rapid depreciation of the Kenyan shilling.
To address these challenges, Dr. Thugge’s first Monetary Policy Committee meeting saw the implementation of significant interest rate hikes.
The Central Bank Rate (CBR) was increased by 100 basis points initially, followed by further increases totalling 350 basis points, bringing the CBR to 13.00 percent.
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These measures were aimed at stabilising inflation and the exchange rate.
Dr. Thugge highlighted several key reforms introduced under his leadership, including:
- A new monetary policy framework based on inflation targeting.
- The Kenya Foreign Exchange code for commercial banks.
- The implementation of Electronic Matching Systems (EMS) in the interbank forex market.
- The unification of parallel exchange rates.
He also mentioned the launch of the Dhow Central Securities Depository (DhowCSD) by President Ruto, which has enhanced Kenya’s financial market infrastructure, promoting efficiency and financial inclusion.
Dr. Thugge emphasised the CBK’s commitment to supporting low-income investors through the introduction of a retail bond, M-Akiba, which allows investments as low as $5 in government securities.
This initiative aims to democratise access to government securities for all Kenyans.
Addressing financial stability, Dr. Thugge stated that Kenya’s banking sector remains sound and stable. He highlighted efforts to transition to a green economy through the draft Kenya Green Finance Taxonomy (KGFT) and Kenya’s leadership in digital financial services, which has significantly expanded access to financial services.
Dr. Thugge concluded his speech by noting the positive impacts of these measures.
Overall inflation had dropped to 5.0 percent by April 2024, and the Kenyan shilling appreciated by 17 percent against the U.S. dollar, reducing debt service costs.
The projected economic growth for 2024 is approximately 5.7 percent, driven by agriculture, the resilience of the services sector, and government measures supporting economic activity.