By Rédaction Africa Links 24 with Daily Nation
Published on 2024-01-24 21:00:00
I recently had the opportunity to present a research paper on the role of actuaries in public policy analysis processes at the International Actuarial Association conference (IAA). I emphasized the importance of utilizing actuaries to make informed decisions on the economy, especially in areas that require mathematical modeling, situation analysis, stress testing, simulations, monitoring, and evaluation.
Actuaries undergo rigorous training that equips them with financial, legal, mathematical, statistical, economic, and public policy analysis skills. This makes them valuable experts capable of advising on the complex world of the global economy. Many developed countries have integrated the expertise of actuaries into their government planning and operations, effectively solving complex economic problems.
For example, the Government Actuary Department (GAD) within the Treasury in the United Kingdom is responsible for advising the state on complex global financial and economic decisions. The success of GAD in improving the UK’s public sector planning, including economic, pension reforms, and financial strategies, serves as an inspiring model for other nations, including Kenya, with its numerous competing dynamics.
In Kenya, the current high dollar problem poses economic challenges, necessitating a multifaceted modeling approach. Actuaries can offer simulated solutions, including sound monetary policies, strategic use of interest rates, building foreign exchange reserves, promoting export diversification, attracting foreign direct investment, implementing fiscal responsibility, and addressing structural issues.
The integration of actuarial expertise into government planning and operations would provide thorough risk assessments and better inform budgeting choices. It would also streamline risk management processes, ensuring that the government is prepared for potential economic challenges, such as addressing high debt levels, and improving financial forecasting and policy outcomes. Actuaries can also aid in sustainable budget planning, benefiting crucial infrastructure, education, and healthcare sectors, and providing valuable input on policies with significant financial implications.
Having actuaries involved in Kenya’s public policy-making processes is a strategic and progressive initiative, aligning with global best practices and signifying a significant step toward improved management of public finances. Their expertise can guide the government in managing various financial and demographic challenges, supporting sustainable economic growth and development, and ensuring that Kenya’s policies and programs are financially sound and aligned with the Vision 2030 goals.
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