CBK nominee Kamau Thugge gets approval from key parliamentary committee

By Monica MUEMA

The National Assembly’s Finance and National Planning Committee has approved of President William Ruto’s pick for the next central bank governor and recommended that the National Assembly supports his appointment of Dr. Kamau Thuge, virtually guaranteeing that he will get the job.

Ruto last month nominated the former senior Treasury official who has also worked as a presidential adviser.

He is expected to replace Dr. Njoroge, who is retiring after serving two terms as central bank governor since 2015.

A parliamentary report dated June 6 said: “Having considered the suitability, capacity and integrity of the nominee … the Departmental Committee of Finance and National Planning recommends that the National Assembly approves the nomination of Dr Kamau Thugge, CBS as Governor of the Central Bank of Kenya”.

Ruto’s party United Democratic Alliance (UDA) and the Kenya Kwanza Coalition controls parliament so Thugge is now all but guaranteed to become Njoroge’s successor at the central bank.

He has previously worked in the Ministry of Finance as head of Fiscal and Monetary Affairs Department, Economic Secretary and as Senior Economic Advisor.

He has also coordinated the formulation of legislation for implementing devolution, including the Public Finance Management Act, 2012 and the Commission on Revenue Allocation Act, 2011.

Thugge, obviously a political appointee, braces for unprecedented challenges and will be expected to also keep the markets calm to help cushion against the increasing non-performing loans, political interference and uncertain global financial trends like the impacts of the European war on the economy.

Ordinarily, the bank’s board of directors oversees CBK’s functions by formulating key policies including guidelines that govern the Monetary Policy Committee (MPC). It also reviews the committee’s performance periodically – often every three months.

Other issues such as unsustainable macroeconomic policies (including large current account deficits and unsustainable public debt), excessive credit booms, large capital inflows, and balance sheet fragilities, combined with policy paralysis due to a variety of political and economic constraints, will also be of great concern to the next CBK governor.

His first call of action, however, will be to stabilize the weakening local currency – a debate that continues to provoke moods.

This is a developing story…