CENTRAL BANK OF KENYA
Remarks by
PROF. NJUGUNA NDUNG’U
GOVERNOR
January 30, 2014

The Chairman of Council, Prof. Ratemo Michieka;
The Chancellor, Mr. Benson Wairegi;
The Vice-Chancellor; Prof. Olive Mugenda;
Deputy Vice-Chancellors; Prof. John Okumu (Academic), Prof.
Keren Mburugu (Finance and Development), Prof. P. K Wainaina
(Administration) and Prof. Fredrick Graveris (Research,
Innovation and Outreach);
Dean, School of Economics; Prof. Nelson Wawire;
Senate Members;
Invited Guests;
Professors;
Lecturers;
Students;
Members of the entire University Community;
Distinguished Ladies and Gentlemen:
It is a pleasure and honour for me to officiate at the opening of
this beautiful facility put up to address infrastructural
challenges and support economics training at this University. I
take this opportunity to thank the University Management for
bestowing this honour on me and also for being visionary in
addressing the infrastructural challenges that face many of our

universities, especially the public ones. A state of the art facility
like this is as important as the discipline being taught and
signals that the discipline will provide the best training
capabilities.
Ladies and Gentlemen: Vision 2030 growth objective is to propel
the country to the middle income country status. It is anchored
on the investment and the capacity that should be developed.
Economics is one such important discipline where we need to
invest in and develop capacity to improve on public policy.
In this regard, may I congratulate Kenyatta University for making
significant contributions towards building this knowledge pool
and especially in the discipline of Economics, where as a
country we still suffer serious capacity deficits. Putting up such a
facility to further train the much needed economists is testimony
that the University is addressing key gaps in nation building. In
2008, Kenyatta University was the second University after
Nairobi to inaugurate a School of Economics in Kenya. There is
indeed need for more universities to emulate the University of
Nairobi and Kenyatta University to establish more Schools of
Economics in Kenya to train more economists and satisfy the
growing capacity requirements in both public and private sectors.

Ladies and Gentlemen: Let me enumerate a few recent
developments that have pushed the demand for economists to a
new high level;
Adoption of the new constitution that has created a devolved
government to the counties has generated huge demand for
economists at the county level to support economic reforms and
decision making based on sound evidence.
In addition new institutions have been defined by the new
constitution. We need strong institutions to manage the process
as strong institutions define the rules of the game and define
the appropriate incentives - the basic tenets of strong
institutions. You are familiar with the pitfalls of institutional
failure.
Regional integration fronts at the EAC, COMESA and
continental level provide us with the opportunities that call
for building strong human capital base, especially in
economic policy analysis to support the new institutional
structures being created.
The discovery of natural resource wealth in our country will
require knowledge of natural resources management for the
current and future generations. This is important to avoid the

Dutch disease outcomes that plagued other resource rich
countries or what is now being called a “natural resource
curse”.
Kenya’s locational advantage in the EAC calls for building of
critical infrastructure and capacity to provide leadership,
efficient services to support the landlocked countries and
policy direction in the region. A good example of the need for
continuous build-up of human capacity is manifested in the
rapid expansion of Kenyan banks in the EAC region, current
at 282 subsidiaries.
Growing demand for economic research and policy analysis to
inform policy in various policy development areas; and the
need to develop economic and forecasting models for
assessment, monitoring and evaluation requires a critical mass
of well skilled economists.
The world is becoming more integrated through globalization,
ICT development and liberalization of economies and
financial markets. These developments are challenging to the
economic policy making process. For instance, CBK is grappling
with monetary policy in the face of changing financial
architecture, dynamism, innovation and external shocks.
These new challenges require dynamic, intellectual capacity to
give solid advice. We are glad that KU is undertaking to build

the necessary capacity. In addition, the unconventional
monetary policy in Europe and America give rise to global
signals of weaknesses in the global economy to watch and react
to, at all times.
There is evidence of good macroeconomic management in the
past that have ensured Kenya’s economic growth. The growth
outlook for 2013 and 2014 remains positive. Capacity is
required to keep the economy on a positive growth trajectory in
the coming years.
Ladies and gentlemen; let me take this opportunity to
acknowledge that the CBK is a beneficiary of the capacity built
from this University and has worked closely with the School of
Economics to provide 5 internship slots for undergraduate
students. This kind of partnership should be encouraged in order
to improve quality in the training of economists at all levels.
Thus the need for building capacity is well motivated and
cannot be over emphasized. The international community IMF,
ACBF, AERC and others have supported institutions of higher
learning in Kenya and it is important to work with them to
continue producing highly skilled economists for absorption in
the local and EAC market. Having worked with AERC, I know

the support we provided to the then Department of Economics.
The continuous training and capacity building should continue
to keep up with a dynamic changing world. Thank you for
undertaking this endeavour to train and fill the existing
capacity gaps of economists.
A word to the students making use of this facility: pursue
excellence in economics to ensure the investment pays dividends
to the country. It is the quality of education that we confer here
that is critical and all stakeholders in this training should strive
to achieve their best.
In conclusion, I would like to say that I have no doubt in my
mind that the facility that we have opened today is going to add
value to the training of economists at Kenyatta University. With
these remarks, I now have the pleasure to declare the School of
Economics Building officially opened.
PS: As a token of appreciation and as a scholar, I will provide
the following of my latest works.
1. Kenya Policies for Prosperity – five copies.
2. Applied Time Series Econometrics – five copies.

Thank you