On Kenya’s Oligarchy, Twisted Democracy & Dashed Hopes of the Third Liberation

By Sitati Wasilwa

A year after Kenyans took to the polls, a number of political events have occurred, and have shaped the country’s political landscape in some respects.

From nullification of the outcome of the presidential election, the repeat presidential election boycotted by Raila Odinga, the historical swearing-in of Odinga as the people’s president, the muzzling of dissenting voices by the administration of the day to the unexpected handshake, it’s been a political melodrama of sorts.

Reflecting on the pre-election and post-election happenings, Kenya comes out as a flourishing oligarchy and a failing democracy, a twisted one for that matter.

Fundamentally, a democracy is a political system characterized by a free, fair and credible electoral process. On the other hand, the electoral process in an oligarchy comes out as fraudulent, fake and crooked.

Basing on the credibility of the electoral process in the lead up to the 2018 general elections, it is correct to assert that Kenya’s trajectory towards a vibrant democracy is twisted.

Historically, Kenya’s political system, and extensively the economic system, only benefit few individuals who control the means of production and the balance of power. This is an explicit manifestation of an oligarchy.

Kenya’s pre-supposed democratic tendencies, to say the least, are far-fetched and illusionary. Politically and economically, the majority, whom democracy accords the right to call the shots, have never had their way in the country with the exception of the formation of the NARC administration and the institutionalization of the current constitutional dispensation.

An honest rumination in view of Kenya’s political and electoral malfeasance wouldn’t take place without weighty consideration of the compromised Independent Electoral and Boundaries Commission (IEBC), the role and influence of the Western states – the so-called masters and defenders of democratic ideals, the excessively irrational average voter, the highly deceptive public relations (PR) and political consultancy firms, and the Third Liberation whose conceptualization is fast waning.

Basically, an institution is as good or bad as the people charged with the mandate to steer it. From the family – the basic unit of social organization, a school, an organization, a football team and a government, competence is a tenet necessary for the success or failure of an entity.

In the run up to the 2018 general elections IEBC’s senior officers proved to be partisan and compromised thus jeopardizing the independence of the electoral body.

Independence of an electoral body is the foremost step in having a free, fair and credible electoral process. The independence of the IEBC is interfered with right from the appointments of the commissioners and other senior officers of the country’s electoral body.

The embattled chair of IEBC Wafula Chebukati has proven to be quite incompetent but this is not a surprise anyway given his subpar performance while being vetted by Parliament for the hot seat. He was not the best out of the other candidates and being appointed to chair the IEBC fixed him in a corner.

Other commissioners were clearly partisan and their political intentions well known. We can’t have a clean electoral process with such poisoned minds running an exercise that determines the fate of Kenyans economically, socially and politically.

Western states – the masters of impunity and double-standards – supported a corrupt regime out of geo-political and geo-economic interests. Led by the American government, they pronounced the legitimacy of an administration which they were not in favour of in 2013.

Who offers support and confers legitimacy to a regime whose rogue police officers killed and injured innocent Kenyans including harmless children?

Setting the record straight, political correctness is the language preferred by the governments of the Western states. Kenya’s case and other immoral governments across Africa being cheered on by the West is largely informed by their (Western states) intentions to counter China’s influence on the continent.

If the likes of the American, British, French and other Western governments are champions and crusaders of democracy, then it would make sense if they were not funding undemocratic regimes and toppling legitimate governments around the world.

As matter-of-factly, Western governments have never condemned the rogue and undemocratic regime in Saudi Arabia. They wreaked havoc in Afghanistan, Libya, Yemen, Syria and other nations but only as a divide and rule scheme driven by paranoia and economic interests.

Apart from the political relief offered by the West, the deception and destruction caused by the global political consultancy firms such as Cambridge Analytica should never be forgotten going forward.

The political consultancy firms are in pursuit of profits, economic capital and economic power as the political parties and formations are hell-bent in pursuit of political capital and political power. But to what extent is the price to be paid for the trade-off between business profits and political power?

Apparently, the price is costly and takes the form of a disintegrated country. These firms pursue their profits by optimizing on the structural weaknesses of a country.

For instance, in Kenya, Cambridge Analytica which was responsible for running the Jubilee Party’s political campaign ostensibly capitalized on the ethnic fault lines that are highly visible in the Kenyan society.

So far no serious step has been made in banning such firms from operating in Kenya especially in running political campaigns. This country is a joke. Pressure from various entities eventually forced Cambridge Analytica to shut down its operations.

In South Africa, PR firm Bell Pottinger, known to work for despots, was chased from the country after running racially charged campaigns especially on economic reform and the prevalent socio-economic inequalities in the country.

But unlike in Kenya where the public never protested about Cambridge Analytica’s divisive campaign, the publics in Britain and South Africa were vocal on the firms’ PR gimmicks.

Involvement of these firms in Kenya’s political space with the intention of driving narratives that are misleading and dangerous casts the country as a twisted democracy.

Embers of the Third Liberation that flamed up following the flawed electoral process flickered out as soon as the ‘handshake’ between Raila Odinga and Uhuru Kenyatta came to the fore.

Doubts have been cast on the supposed Building Bridges Initiative and yours truly is among the doubters. Judging from Kenya’s political history the ‘handshake’ is as good as any other political deal and its abandonment would not be a surprise.

Political (electoral) justice and economic justice should be the key drivers of the Third Liberation. But with political interests taking centre stage the hopes for a new Kenya are dashed.

Failure to address injustices committed in recent times and long before that will not actualize building bridges on the social, political and economic issues that divide Kenyans. Ignoring the implementation of the recommendations put forth by the Truth Justice and Reconciliation Commission (TJRC) only sets the country on a path for intensified calls for secession, massive socioeconomic inequality and electoral skullduggery in the near future.

In view of the aforementioned weighty issues, where does the Kenyan public stand? There is no hope for a better Kenya considering the dubious electoral and political decisions made by majority of members of the public.

Can the Kenyan public dislodge the oligarchs that have patronized the country’s politics and economy since the dawn of independence? This is a question of fundamental importance. But with a significant number of Kenyans voting in an unintelligent fashion and being unapologetic about their ethnic political ideologies there is no hope of Kenya transitioning to a nation.

Kenya has never been a nation. All the episodic moments of nationhood – independence, the Second Liberation, dethronement of the rogue and despotic KANU regime and promulgation of the current Constitution – involved elements of disenchantment with individuals at the centre of the government preferring to subscribe to the ideals of an oligarchy.

Let’s not pretend to pursue national unity in the spirit of the ‘handshake’ and the doctrine of accepting and moving on while escaping from addressing the country’s problems. That is not how a nation is built.

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For the many? A look into the 2018/2019 Budget Policy Statement

By Sitati Wasilwa

The 2018/2019 Budget Policy Statement (BPS) that was recently presented in the National Assembly seeks to promote prosperity among Kenyans of all walks of life. The would-be large-scale prosperity is aptly captured by the budget’s theme: “Creating Jobs, Transforming Lives and Sharing Prosperity.”

There is no doubt that socio-economic inclusion is a fundamental tenet that promotes robust economic growth in the long-run, and consequently, structural transformation. Hence, the need for the Executive, through The National Treasury, to align its policy agenda with development blueprints such as the national Vision 2030, East Africa’s Vision 2050, Africa’s Agenda 2063 and the global 2030 Agenda for Sustainable Development.

In pursuit of shared prosperity among the many – the country’s hoi polloi – Cabinet Secretary (CS) Henry Rotich presented a Kshs.3.07 trillion budget to the National Assembly. However, there is discrepancy between the actual amount of the budget and the amount that Mr. Rotich read out in the National Assembly.

Why the Discrepancy?

Playing “safe politics” is the root cause of Mr. Rotich’s lie that the national budget amounts to Kshs.2.556 trillion. The actual amount of the budget is Kshs.3.07 trillion and this implies that there is a difference of about Kshs.514 billion that the CS didn’t offer an explicit explanation about it.

It should be noted that the difference is what constitutes the principal debt amortization and rollovers which in essence refer to the repayment of both the domestic debt and the external debt.

Primary Concerns

With the 2018/2019 Budget Policy Statement being the largest ever in the country’s history, concerns have been raised in regards to raising finances to fund the expenditure, and the chain effect triggered by the financing plans outlined by CS Rotich.

For instance, with a deficit of Kshs.558.9 billion, it is certain that the government will borrow to plug the deficit. It is expected that the government will borrow Kshs.287 billion from external sources and Kshs.271.9 from domestic entities.

Borrowing will automatically impact on the national debt which, according to the debt statistics by the Central Bank of Kenya, stands at Kshs.4.88 trillion. With basic reasoning, it is therefore true to assert that the public debt will be over Kshs.5 trillion in the 2018/2019 financial year.

Treasury has resigned itself to defensive play in view of the rising public debt which it considers to be safe. The regime’s sympathizers have also joined the bandwagon of defending the excessive borrowing and branding the critics of the sky-rocketing debt as “unnecessary alarmists, cynics and irritants.”

One particular line of defence put up by the Treasury and the Executive is that even developed countries have extremely high debts to GDP ratio some to the tune of over 150% and 200% compared to Kenya’s currently at 60%. This is misleading.

A major way of analyzing economic policy is sizing up economic issues and dissecting them as per the given context. Developed countries are able to easily sustain their debt levels because of high economic productivity and the low interest rate repayments pegged on the borrowed finances.

Considering the African context, Ghana courted a debt crisis in 2016 as a result of irresponsible borrowing. Recently in the month of March, Mozambique defaulted on its debt with the public debt to GDP ratio at 128%. This month, the Zambian government has adopted austerity measures in light of the country’s worsening debt crisis.

A stale argument advanced by the Treasury is that in the medium-term and eventually in the long-term, Kenya’s public debt will significantly decrease. But if previous public finance data are to be scrutinized, it seems as if the medium-term and the long-term periods will never materialize as the debt keeps on accumulating and this is the genesis of a debt trap and crisis.

Financing the so-called and much-touted ‘Big Four Agenda’ was a major highlight of the BPS. It is expected that this policy agenda will be financed to a tune of Kshs.460 billion, but a closer look at the budget reveals otherwise; only Kshs.73.75 billion has been allocated to the ‘Big Four’ while the rest is to be expended on the enablers of the ‘Big Four’.

Contents of the Big Four – a vibrant manufacturing sector, food security, universal health coverage, and affordable and descent housing – are not new policy propositions in the country. By the way, these items featured on the policy agenda of the Jubilee administration between 2013 and 2018 that was tainted by plundering.

Expenditure for food security is ridiculous considering the propositions of key benchmarks such as the Malabo Declaration which requires that African governments allocate at least 10% of the public expenditure towards financing the agricultural sector. The Jubilee administration, for the sixth year running, has consistently allocated not more than 5% of the budget for financing agricultural activities.

What is Kenya planning to export and how will it establish a vibrant manufacturing sector if the budgetary allocations for the agricultural sector are lower? Kenya has the capacity and advantage of producing huge amounts of agricultural products and facilitating value addition on them and this can act as a basis for establishing a strong manufacturing sector.

Taxation measures proposed by the Treasury are majorly intended to raise revenue critical in financing the budget. Of great concern, however, is whether the Kenya Revenue Authority will be able to meet the targeted revenue of Kshs.1.74 trillion.

To hit the targeted revenue, Treasury has proposed a series of changes in relation to the country’s tax structure which are highlighted in the Finance Bill set to be presented in Parliament for approval.

In as much as these changes are intended to redistribute income, prevent environmental degradation, protect local industries among other goals, the overarching objective is financing the administration’s over-ambitious budget and servicing the ballooning public debt. This in fact informs the need to expand the tax bracket with the informal sector, betting and gambling activities as well as mobile money transactions being targeted.

Repealing the Banking Amendment Act (2016) that introduced interest rate caps is welcome. The cap on the interest rates is an economic policy that has failed to achieve its intended objective; increasing access to credit through lower interest rates.

However, the proposed measures to protect consumers from predatory and reckless lending by the credit providers as contained in the Financial Markets Conduct Bill, emasculates to some extent the mandate of the Central Bank of Kenya.

The Bill seeks to establish the Financial Markets Conduct Authority (FMCA) which CS Rotich claims that “it will only be limited to protecting consumers in the areas that have not been covered by existing regulators including the Central Bank.” Why not strengthen the existing regulators? Why would public funds and other resources be wasted in setting up the FMCA? FMCA is unnecessary.

Having the budget is one thing while seamless implementation of it is a different issue. Challenges such as corruption and failure to collect the targeted revenue are pitfalls that will deny the many average Kenyans the benefits envisaged in the 2018/2019 BPS; shared prosperity, employment opportunities to be created and transformed lives.

Public Finance History

Three fundamental issues characterize Kenya’s public finance history and trajectory; corruption, low absorption rate of development expenditure, and the failure by Kenya Revenue Authority (KRA) to meet the targeted revenue.

Kenya loses one-third of its budget every year due to corruption. If this is the case, then about Kshs.1 trillion of the 2018/2019 budget will be directed from the public purse to private pockets. Accountability of the spending is a big challenge considering that Parliament itself goes to bed with the Executive thus jeopardizing the independence of the former.

Unimportant allocations and expenditures are pursued with the aim of wealth accumulation at the expense of initiating development projects. What worsens the situation is the looting that takes place in various government agencies and institutions. The Office of the Auditor General attempts to raise queries on the unaccounted for spending but Parliament and the Executive have failed spectacularly in providing the necessary political will.

Revenue collection is characterized by unrealistic targets that KRA is expected to attain. This stems from the massive deficits that Treasury has presided for the last five financial years. For instance, in the 2016/2017 financial year, the shortfall in revenue amounted to Kshs.66.64 billion.

For the current fiscal year 2017/2018, the situation will be similar bearing in mind that as by December 2017, as documented in the Post-Election Economic and Fiscal Report, there was a shortfall in the total cumulative revenue by Kshs.68.3 billion. The 2018/2019 financial year will not be different in any way.

Absorption rate of the development expenditure is poor with finances allocated for various development projects embezzled. Stalled infrastructural projects are an indication of the poor absorption rate of the finances set aside for development. With Kshs.671.6 billion allocated for development expenditure, perhaps only 50% of it will be utilized.

Regular and annual commentaries on the Budget Policy Statements should take into consideration the hits and misses of the spending of previous financial years.

The recently read budget will not be effective; the public debt is set to increase, various taxes are set to go up and of course shortfalls in revenue are expected. This is not a budget for the many considering the high and exaggerated expenditure. And since a huge chunk of it will be looted, then there is nothing to smile about.

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The Political Economy of the South Sudan Conflict

By Sitati Wasilwa

It is close to five years since civil war broke out in South Sudan with negotiations failing to seal a peace deal between the warring groups. The unending conflict that started in December 2013 has resulted in destitution with thousands murdered and millions displaced.

The Council on Foreign Relations estimates that 50,000 South Sudanese have died since December 2013 when the war began. The Human Rights Watch approximates that 2 million South Sudanese have been internally displaced due to the conflict, while a further 2 million have sought refuge in the neighboring countries.

Of the 2 million refugees beyond the borders of South Sudan, 1 million are in Uganda. Of the 2 million people that are internally displaced, 230,000 are camping at various United Nations’ bases across the country.

As war ravages Africa’s youngest state, the country’s economy has collapsed. As highlighted by the African Development Bank, the economic growth of the South Sudanese economy is on a freefall with the country’s real Gross Domestic Product (GDP) contracting. For instance, the country’s GDP shrank by 5.3% in 2015, contracted by 13.1% in 2016 and it is estimated to have declined by 6.1% in 2017.

Additionally, the country’s inflation rate reveals the ebbing of the economy’s fortunes with the latest figures indicating that the rate of inflation is 161%.

Following the economic hardship experienced in South Sudan, President Salva Kiir recently fired the Governor of the Central Bank and his deputy over the failure to deal with inflation. This was a symptomatic gesture bearing in mind that the country’s sinking economy is only reacting to the volatile political situation, and the sacking of the two officials is a scapegoat of the structural challenges that bedevil South Sudan.

Structurally, the primary reason why the conflict in South Sudan will not be ending anytime soon regards the distribution of wealth and the proceeds generated from the wealth. Internally and externally, conflicting interests among various groups have stalled the peace process and in any case, these groups continue to fuel the civil strife.

Internally, the desire to amass wealth is driving more entities into the war. Recently, Paul Malong, a former chief of staff of the army formed a rebel movement with the intention of fighting against the current administration which he considers to have failed in regards to restoring peace in the country.

Each of the existing militia groups seeks to impose some form of territorial control over the regions which are considered to be highly endowed with natural resources. The corrupt nature of the Salva Kiir led administration prompted the onset of the crisis with his family members and cronies looting the country’s national wealth at the expense of the ordinary South Sudanese citizens.

Transparency International ranks South Sudan at position 179 out of 180 countries as per the 2017 Corruption Perception Index report. This implies that South Sudan is an excessively corrupt state.

The question of who controls what in view of the natural resources is fundamental in understanding the genesis and nature of the conflict. From the exploration of oil, to gold mining activities as well as poaching and trafficking of wildlife, few individuals have strategically positioned themselves to benefit from the country’s natural resources.

With the economy grounded, oil exploration activities seem to be on a lull. But illicit trading of fuel is vibrant in the country an act that occasioned President Salva Kiir to issue a stern warning to the illegal fuel traders in July 2017.

However, the warning by the incompetent president can be regarded as a sideshow if the information documented in the Sentry Report is factual. The Sentry Report, titled “Fueling Atrocities: Oil and War in South Sudan”, outlines how funds from the oil exploration activities are used to fund militia groups and in due course aggravate the conflict.

According to the report, several militia groups exist among the Dinka community (Salva Kiir’s ethnic group) and they are tasked with protecting the oil reserves, an act that has led them to be widely known as the “Oil Protection Force.” The report further highlights on how the government finances the activities of the militia groups allied to the government.

Externally, geopolitical and geoeconomic factors continue to exacerbate the conflict in South Sudan. Both regional and foreign states have a hand in the unending crisis. The scramble for the natural resources in South Sudan and the benefits derived from the war occasion a number of states to hatch strategies intended to prolong the war.

In as much as the USA is vocal in pushing for the South Sudanese president to restore peace mainly through the use of sanctions and other threats, it cannot be denied that the American government is also responsible for the chaos.

With hindsight, the USA government played a primary role in the creation of the South Sudanese state. In fact, as highlighted by the Foreign Policy magazine, George W. Bush prioritized the creation of South Sudan in his foreign policy agenda.

Historically, the USA has greatly been involved in countries that are rich in oil and South Sudan is not an exception. The USA has a penchant of creating chaos and instability in order to profit economically from natural resources in states perceived as fragile. With Chinese presence in South Sudan being visible, USA may be using the chaos as a counter-strategy of China’s commercial interests in the country.

It is on record that the USA government declared President Salva Kiir as “an unfit partner.” Later on speaking before the United Nations Security Council, US Ambassador to the UN Nikki Haley warned that “words are no longer sufficient” in regards to the ongoing civil war. Such sentiments are an indication of a gloomy situation perhaps involving the violent removal of Salva Kiir from power.

But the forceful removal of Salva Kiir as president will be recipe for more chaos and the state building process will be even harder than it is at the moment. History shows that USA’s violent interventions result in the formation of puppet governments working for the interest of USA rather than for the collective interest of the citizens.

Though China has actively intervened in the conflict contrary to the fundamental ideals of its hands-off foreign policy, it cannot be ruled out that Beijing supports the Kiir administration with weapons to fight the various rebel groups.

Furthermore, Ukraine was accused in May last year for supplying arms to the South Sudanese government. It cannot be ruled out at the moment that such a similar activity is going on.

Regionally, various states are responsible for the civil strife in South Sudan. For instance, Sudan has a hand in the chaos rocking the world’s youngest state. Before gaining independence, the south battled with the north for a record 22 years between 1983 and 2005 in what has come to be referred to as the Second Sudan Civil War.

Origin of the Second Sudan Civil War can be traced to the attempt by former Sudanese president, Gaafar Mohamed el-Nimeiri to create an Islamic state, a move which forced the southerners under the leadership of John Garang de Mabior to put up an armed struggle.

With the independence of the southerners, however, Khartoum’s nosiness in the affairs of Juba is a fundamental factor that has prolonged the conflict. This follows the disagreement between the north and the south over the oil-rich region of Abyei.

Abyei belongs to South Sudan but since it is endowed with a lot of oil, the north keeps preying on the oil with total disregard of the Abyei Protocol which required that the region holds a referendum to decide whether it belongs to the south or the north.

Currently, Khartoum continues to run the affairs of Abyei with President Omar al-Bashir declaring in February last year that the region was part of the north and ordered the residents to apply for identification documents as per the laws of Sudan.

Khartoum offers support, financially and militarily, to some of the rebel groups in South Sudan in order to prolong the conflict and in due course profit from the oil in Abyei.

Uganda’s interests in South Sudan play a major role in the conflict. Uganda is South Sudan’s largest trading partner with various Ugandan entities engaged in the trading of oil, agricultural produce like maize among other commodities. As reported in February last year, Uganda was set to import gold from South Sudan.

Military interventions of the Ugandan army serve to protect the interests of Kampala in South Sudan. Additionally, driven by the paranoia of the Lord’s Resistance Army (LRA), President Yoweri Museveni finds a justification to stir the waters in South Sudan. The Ugandan government collectively supports the South Sudanese government and various militias so that Uganda can continue profiteering from the civil strife. Uganda is home to 1 million South Sudanese refugees and this means money from the West to the government and its cronies.

In January 2018, Adama Dieng, the U. N secretary general’s special adviser for the prevention of genocide, accused Kenya and Uganda of fueling the conflict by allowing weapons and ammunitions destined for South Sudan to pass through their territories.

The corrupt nature of the Kenyan and Ugandan governments is a precipitating factor for the shipment and transportation of large quantities of weapons and ammunitions to South Sudan.

Kenya and Uganda host a large number of South Sudanese nationals. Majority of the South Sudanese government officials and their families lead opulent lifestyles in Nairobi and Kampala. The rich government officials and their cronies as well as the wealthy individuals financing the militias profit from the civil war as the average and poor South Sudanese languish in destitution.

Resolving the conflict calls for setting up mechanisms to look into the distribution of the natural resources and/or wealth in the country. Until the question of “who profits from the natural resources” is effectively answered, chaos will continue rocking South Sudan.

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On Africa’s Free Trade Initiative: Grand Illusion or Breakthrough?

By Sitati Wasilwa

On 21st of March 2018 in the city of Kigali, 44 member states of the African Union (AU) ratified the establishment of the Continental Free Trade Area (CFTA). Ratification of the CFTA was the main agenda during the Extraordinary Summit on the African Continental Free Trade Area.

The Extraordinary Summit was a culmination of a series of meetings seeking to boost the intra-African trade which, according to the 2017 African Economic Outlook report, is estimated to be at 15% of Africa’s total trade. Comparatively, Africa’s trade with China and the European Union is at 15% and 30% respectively of the continent’s total trade.

Countless efforts have been made in the past to boost the intra-African trade, but it was during the 18th Ordinary Session of the Assembly of Heads of State and Government of the AU held in Addis Ababa in January 2012, that a definite plan was formulated to increase trade among African countries.

For instance, the Action Plan on Boosting Intra-Africa Trade (BIAT) was launched during the 18th Ordinary Session, and it highlights seven key clusters to promote trade among African countries. The pillars include trade policy, trade facilitation, productive capacity, trade-related infrastructure, trade finance, trade information and factor market integration.

Basis of CFTA Establishment

The overarching objective of the CFTA is the creation of a single continental market for commodities through the free movement of people and investments across Africa. CFTA is deemed as the precursor of the yet to be established Continental Customs Union and the African Customs Union.

With hindsight, approval of the Lagos Plan of Action in 1980 signaled the intention of African countries to promote economic development with the major highlight of the blueprint being the proposal to establish the African Common Market by the year 2000.

Furthermore, the foundation of the CFTA can also be traced to the Abuja Treaty of 1991 on establishing the African Economic Community (AEC), ratified by 51 heads of governments and states under the auspices of the then Organization of African Unity (OAU).

The Abuja Treaty envisages the establishment of the AEC by strengthening the regional economic blocs in the continent. As such, the Treaty outlines the establishment of the AEC within a period not exceeding 34 years from 1991, through a series of six stages.

Thus, as per this policy document, the AEC should be fully established by 2025 which is impossible bearing in mind the current realities.

More categorically, the sixth stage of the Abuja Treaty outlines that the establishment of the AEC will involve setting up of: the African Common Market, the African Monetary Union, the African Central Bank, and a single African currency among other integration activities.

Additionally, CFTA also has its foundations in the Tripartite Free Trade Area Agreement (TFTA) consented to on 10th June 2015 by 26 member states of the Common Market for Eastern & Southern Africa (COMESA), the East African Community (EAC), and the Southern African Development Community (SADC).

TFTA is expected to hasten trade activities between the ratifying states through elimination and harmonization of tariffs and non-tariff barriers.

African countries hope to achieve socio-economic development through cross-border trade enhanced by the CFTA framework.

Possible Opportunities?

For decades, Africa has been referred to as the continent with a very high potential in regards to socio-economic prosperity. Afro-optimists have even taken the game of potentiality to another level, a higher one of course, by coining the term ‘Africa Rising.’

A disturbing fact is that Africa has only lived to be defined on the basis of the aforementioned description. It is a subtle affirmation of why the ‘Africa Rising’ narrative is an amorphous view of the purported progress that Africa is making.

I do not endorse the general perception that Africa is rising. Africa cannot be rising as a whole when civil strife is the order of the day in a number of African states. Africa cannot be rising when poverty levels are on the increase. Africa cannot be rising when neo-colonialism is on an upward trajectory. It is that simple.

Far from that, African countries are set to unlock their high economic potential through the CFTA. With a population of 1.2 billion people it is expected that such a population will be a catalyst for the continent’s structural transformation – at this juncture it sounds as if the CFTA is the continent’s magic moment for socio-economic prosperity.

A high population can be advantageous as well as disadvantageous. It is advantageous in the sense that it offers a ready market for commodities and the European Union (EU), China and lately India have shown us that. However, this has to be reinforced with other factors critical in promoting economic growth and development such as innovation among others.

A high population is only disadvantageous when rates of economic growth and development registered are poor. And this has been the challenge facing African countries for decades.

The United Nations Conference on Trade and Development (UNCTAD) estimates that operationalization of CFTA first by cutting the intra-African tariffs could generate $3.6 billion in welfare gains to Africa majorly through increased production and cheaper goods.

Africa’s economic potential will be unleashed by the CFTA primarily if free movement of people and commodities will take place. But during the launch of the CFTA in Kigali only 30 states signed the free movement protocol. This restricts the movement of people from one African country to another, with the mobility regarded as beneficial at least to some extent.

Challenges to CFTA

Establishment of the CFTA has been lauded as a crucial step towards the economic transformation of Africa, but there are challenges which threaten its take-off.

One of the challenges is neo-colonialism advanced by foreign powers. With China’s heightened global ambitions and take-over of Africa, in addition to the geo-political activities of nations such as USA and others, the expected rollout of the CFTA is set to falter.

An ambitious Africa is a threat to the global ambitions of the foreign states that control political and economic activities in the continent.

It will only take a few Forum on China-Africa Cooperation (FOCAC) conferences and the United States-Africa Leaders Summit meetings to change the CFTA equation, with Beijing and Washington organizing these conferences on the basis of “renewed interest in Africa” theme.

In addition, the flippant nature of majority of Africa’s political leaders is a challenge to the success of the CFTA. On several occasions, Africa leaders have gracefully appended their signatures to a number of declarations seeking to promote social, economic and political development of the continent.

But amid all the fanfare witnessed during such declarations, implementation of the approved policy proposals is done in an erratic manner and dubious fashion. Take the case of the Malabo Declaration and the Maputo Declaration meant to address Africa’s food insecurity and food production levels.

Political leaders in Africa have to endear themselves to the ideals of the CFTA and show unrivalled commitment. CFTA is bound to fail with subpar political goodwill.

The notion of open borders is not only a threat to the success of the CFTA but also to the unity of Africans. There are various research studies in support for open borders with one such study being a working paper by the National Bureau of Economic Research.  

A common argument for open borders is the increase in productivity for a country where immigrants settle with such people remitting a significant proportion of their earnings or transferring essential skills and technology to their mother countries.

However, various dynamics must be taken into consideration regarding the notion of open borders in view of free movement of people among African countries. African countries have higher rates of unemployment and this is dangerous with the idea of open borders.

Africa’s largest economies by GDP, the most advanced economies, and generally economically stable countries are naturally bound to attract immigrants. But such countries including Nigeria, South Africa, Botswana, Kenya and others have high rates of unemployment.

So, an influx of immigrants to such countries will create tensions with the citizens who will harbor perceptions of their jobs being taken away by non-citizens. The xenophobic attacks in South Africa over the years offer insight into this matter, and perhaps it informed the decision by the governments of South Africa, Nigeria and others not to sign the free movement protocol.

Nationalist sentiments centred on immigration spawned by open borders may occasion some of the African countries to withdraw from the CFTA arrangement or maybe the AEC in the event that the envisaged transition takes place. Brexit and USA’s imminent exit from NAFTA offer insightful lessons.

CFTA will create economic prosperity in Africa, but its success depends on institutional factors such as eradication of corruption, peace, economic and political rights, and generally, competent political leadership.

And depending on what happens next, CFTA can either be a grand illusion or a breakthrough for Africa’s economic prosperity.

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How Will Recent Political Events in China Affect Africa?

By Sitati Wasilwa

On Saturday March 17th 2018, China’s legislature – the National People’s Congress – approved the reappointment of Xi Jinping as the nation’s president with no term limits. This political event was a follow up to the 19th National Congress of the Communist Party of China  (CPC) held in October 2017 during which Xi was confirmed as the General Secretary of the CPC for a second five-year term.

Apart from Jinping’s confirmation as CPC’s General Secretary for another term, the 19th National Congress also immortalized the Chinese president by indoctrinating his ideologies – the Xi Jinping Thoughton Socialism with Chinese Characteristics for a New Era – into the party’s Constitution.

Lately, there are grand intentions to also incorporate the Xi Jinping Thought into the national Constitution of the People’s Republic of China.

Xi Jinping’s speech delivered to the 19th National Congress of the CPC highlighted key principles which his administration seeks to pursue and strengthen.

The immortalization of Xi Jinping’s ideologies, the Xi Jinping Thought, follows a precedence set by the CPC to indoctrinate the policy agenda of the party’s revered leaders as the ultimate guiding principles/ideologies of the ruling party.

Previously, the CPC adopted the Mao Ze Dong Thought as the guiding ideology in 1945 during the party’s 7th Congress though its ‘leftist mistakes’, as documented in the Educational Philosophy & Theory Journal, were corrected during the 12th Congress in 1982.

At the party’s 15th National Congress in 1997, the Deng Xiaoping Theory of Socialism with Chinese Characteristics was established as CPC’s guiding theory. This had been preceded by the indoctrination of the Deng Xiaoping Theory into the party’s constitution during the 14th Congress held in 1992.

Additionally, Jiang Zemin’s Theory of Three Represents was incorporated into CPC’s constitution in 2002, and Hu Jintao’s theory, the Scientific Outlook on Development was ratified into the party’s constitution in 2012.

It can be observed that Mao’s and Xi’s policy agenda are classified as “thoughts” while Jiang’s and Hu’s policy frameworks are described as “theories.” As noted by Zoe Jordan, a Thought, in view of CPC’s constitutional doctrine, “incorporates a body of related ideas into a shared worldview whereas a Theory reflects a mandate relevant to a specific era or relative state of thinking”.

Thence, it follows that Xi Jinping is considered the second most powerful leader of the People’s Republic of China after Mao Ze Dong.

Generally, Xi’s Socialism with Chinese Characteristics for a New Era endeavors to strengthen the Deng Xiaoping Theory that has guided China’s development, internally and externally, for close to four decades.

Externally, in terms of foreign policy and strategy, Deng’s ideology fronted a China that focuses on self-advancement without exhibiting aggressive tendencies to shape international affairs. As written by Son Daekwon, Deng Xiaoping stated that, “keep a low profile and bide your time”, and also remarked at one time that, “By no means should China take the lead.”

But with the New Era premised on the Xi Jinping Thought, China is poised to rejuvenate her ambitions as a global power and leader based on Xi’s speech at the 19th Congress as quoted by Daekwon; China will actively pursue a more nuanced global role as “constructor of global peace, a contributor to development of global governance, and a protector of international order.”

Therefore, what does this mean for Africa?

Africa in Context of China’s New Era Ambitions

For Africa, Xi’s intention of a globally powerful and rejuvenated China is not as threatening as it is to the West. The West for a long time discredited China’s model of economic development and political system but China has consistently proven that democracy and market fundamentalism, as known to the West, are not prerequisites for structural transformation and development.

However, as Daron Acemoglu and James Robinson argue out in the book “Why Nations Fail”, democracy is not a necessary condition for kick-starting the process of development, but it helps in sustaining the virtuous circle of economic prosperity for eternity.

With the inroads that China has made in Africa over the past decade having been based on “development” and “non-interference” with the political affairs of African states, that perhaps is bound to change with the re-invention of Xi Jinping’s global politico-economic ambitions.

China’s economic conquest of Africa outfoxed the foreign policy strategy that the West has pretended to champion for ages; promoting the establishment of democratic institutions. But one wonders why the West led by the nosy USA has had a penchant of supporting autocratic regimes in Africa.

That doesn’t mean that China’s foreign policy strategy is the most preferred, unless by majority of African leaders who exhibit autocratic tendencies. China is well known for not prioritizing the rights of individuals and her political history supports this statement.

Formalization of the Xi Jinping Thought and invention of Socialism with Chinese Characteristics for a New Era imply that Chinese engagement with African states may shift from one anchored on “development” and “political non-interference”, to a foreign policy strategy where the Chinese seek to alter the political architecture of African countries.

What escapes most people’s minds is that China cannot hotly pursue the world’s superpower status through economics alone. It has to tilt the global geo-political and geo-economic scales by influencing the political order of a significant number of countries in the world like what the Soviet Union did during the Cold War.

Africa is likely to witness a resurgent China that will be exporting her political ideologies to the continent. This doesn’t augur well for most Africans who have relentlessly pursued the ideals and values of democracy.

In regards to Africa’s political trajectory, majority of African countries will nonetheless embrace the Chinese political model and ideologies. As a matter of fact, Africa’s political space is marked by a low level of democratic capital and a high level of democratic deficit.

This creates a favourable political environment for the African states to retrogress from establishing democratic institutions, and to embark on building and strengthening a political trajectory that fashions autocratic institutions.

And with majority of African governments being tied to China’s development agenda through the so-called cheap Chinese government loans, the assured long association between Africa and Beijing will certainly create fodder for the latter to export her political ideologies to African states.

It won’t be a surprise that a few years from now majority of African states would have drifted away and departed from the idea of democracy while gladly and blindly embracing the notion of autocracy with the so-called benevolent dictators roaming wild in the continent.

The West Responds, Africa Suffers

Former colonial masters and thereafter passionate neo-colonialists, but nonetheless colonialists, the West continues to influence social, political and economic activities in Africa. Long before China officially bagged Africa as her overseas neo-colony, Western states largely controlled the affairs of African countries though they still do so at the moment.

From granting African states cosmetic independence to shuffling them like cards during the Cold War; to wrecking and crippling their economies through the nefarious and nebulous economic policies known as structural adjustment programmes (SAPs); to orchestrating coupe d’états, and advocating for democratic institutions while at the same time supporting dictators, Africa has seen enough of the West’s experiments.

With China’s emergence as Africa’s new neo-colonial master, the West changed tact in Africa as evidenced by the covers of The Economist magazine in a span of ten years; in 2000, it was “The hopeless continent”, and in 2011 it was “Africa rising.” Was Africa rising because of China?

The Economist’s cover title of “Africa rising” came two years after China surpassed the USA as Africa’s largest trading partner, and so the title was one way of informing the Western governments that they should be more aggressive in Africa as the Chinese had taken over. It wasn’t about Africa rising!

Daggers are drawn! With the invention of the Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, the West is watching particularly the USA. USA and her allies will intensify their activities in Africa.

China’s entrance into the so-called New Era already began with Xi’s global ambitions; first, through his politico-lingual invention of the Chinese Dream, and secondly through the ambitious One Belt One Road Initiative (OBOR).

Response by USA plus her allies to China’s New Era ambitions may negatively affect majority of African states. USA and the Western league at large will use any means necessary to counter China’s move. They will increase their support for despotic and dictatorial regimes in Africa if need be as long as it proves to be an effective strategy in countering China.

Africa is set to witness an increase in the amount of aid from the West as a counter measure strategy to China’s New Era ambitions. As it has been the norm, whether the aid will be directed to address the fabricated goals or will be embezzled or even unaccounted for won’t bother the West as long as the geo-political objectives are achieved.

So, with China’s bold entrance into the New Era theatre and with USA’s much expected response, Africa will gain in terms of aid and infrastructural development but will also lose; drifting away from the idea of democracy, intensified economic dependence, loss of political independence, proxy wars and economic stagnation.

Will African states find their footing amid China’s renewal of her global ambitions?

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Lest we forget USA is also a “Sh*thole”

By Sitati Wasilwa

Spitting fire and fury over his dislike for Blacks and other non-White people, the unrestrained political mongrel in the name of Donald Trump bluffed that immigrants from ‘shithole’ countries in Africa including Haiti and El Salvador are not welcome in USA.

Nobody would have imagined that a president of the so called world’s superpower state would utter such racist and divisive sentiments. But then, it isn’t a surprise since the 45th occupant of the White House is a man terribly short of insight with a delusional penchant for courting attention.

Facing economic, social and political despondency for decades, African states and other poor non-African, non-White countries ashamedly carry along the ‘shithole’ tag.

Precisely, the nature and behaviour of most of the African governments make it prime for the ‘shithole’ classification to ideally define the African governments. Why ‘shithole’ African states?

Look around the continent and realize how African states are infested with corruption, poverty, socio-economic inequalities and disparities, political injustice among other challenges which majority of the states have deliberately refused to address or pretend to be addressing.

Decades after gaining the oft-exaggerated political independence, the filthy majority of the African states are facing the same socio-economic and political problems they sought to effectively deal with at the time the cunning colonialists ‘declared’ them politically independent.

But most people often forget, or at least pretend to forget that African countries would be miles ahead socially, economically and politically were it not for the colonization and neo-colonization of the Black man’s continent.

Who are responsible for colonization and neo-colonization of Africa? The foreign powers, with their mad rush to Africa premised on the classical rivalry between the Western and Eastern hemispheres of the world, though the greedy African political leadership is also to be blamed.

The West has been led by USA for years following the crumbling of the British Empire. Taking advantage of the historical and apocalyptic fall of the British Empire, the USA took over the world’s leadership with her hegemonic global agenda fueled by the much famed ideology of American Exceptionalism.

During the Cold War, African states were vulnerable to the antics of the world’s superpowers at that time, the USA and the former Union of Soviet Socialist Republics (USSR), before the latter’s cataclysmic disintegration. African countries were enticed by ‘gifts’ from the capitalist axis led by USA and communist axis under USSR’s leadership.

Neo-colonialism, which Africa’s former colonial masters had institutionalized, intensified as a result of the Cold War. Foreign powers offered financial and technical assistance to African states that cooperated with them with some going to an extent of facilitating the toppling of governments.

Of particular concern is the role played by the notorious USA and nosy France in overthrowing legitimate governments across Africa.

USA, for instance, was instrumental in engineering the military coup in Ghana then under the leadership of the charismatic pan-Africanist, Osagyefo Kwame Nkrumah. The aim of the coup in Ghana was to trigger a stream of chaos or put in place a puppet regime so that USA could get as much cocoa as possible at extremely cheaper rates.

Across Africa’s Great Lakes Region in the lush Congo Forest, the Democratic Republic of Congo (formerly known as Zaire) was not spared either by the covetousness of Washington. The USA government was behind the ousting of the influential pan-Africanist Patrice Lumumba who was captured, tortured and executed.

Lumumba was replaced by the flashy dictator, Mobutu Sese Seko, whose puppet regime went to bed with the USA government to loot the minerals at the expense of the Congolese citizens, majority of whom are poor.

Disguising herself as the champion of democracy across the world, the USA didn’t bother to promote democratic principles in DRC, choosing instead to confidently support a dictatorial regime led by the despotic Mobutu. Currently, USA’s multi-national corporations walk into DRC, collect minerals and walk out in fashion under protection of DRC’s authoritarian regime and the USA government.

Nigeria also endured a lengthy period of political instability characterized by coups that the USA partly orchestrated. They saw the oil and voila, they triggered chaos in Africa’s most populous country. Washington shipped the oil as poor Nigerians wallowed in poverty.

In dubious fashion, the USA government continues to be hell bent in supporting non-democratic regimes in Africa and interfering with the sovereignty and territorial integrity of other states.

Ethiopia, Uganda, Kenya, Djibouti and other states that have non-democratic governments continue to enjoy the support of Uncle Sam. Ethiopia has a terrible human rights record but Washington cannot advocate for the rule of law to be observed owing to the fact that the former is a strategic military partner to the USA government.

Having mastered the art of double-standards, the USA cannot condemn the authoritarian regime of East Africa’s longest-serving despot, Yoweri Kaguta Museveni. In Kenya, the USA government is supporting the corrupt and rogue Jubilee administration without showing utmost concern for social and political injustice brought to light before, during and after the electioneering period.

By the way, I’m exasperated by the dictatorial antics of the despotic Jubilee administration that rekindles the memories of the anti-democratic KANU regime. Kenya’s democratic gains have been eroded under the Jubilee administration and unapologetically, Kenya is acquiring a peculiar statehood of being a shithole of shitholes. Washington, the champion of democracy, would pretentiously ignore this.

Uncle Sam wouldn’t raise a finger and condemn Djibouti’s strongman, Ismail Omar Guelleh as the tiny Horn of Africa nation plays host to the former’s military base. Apart from the USA, Djibouti has allowed France, Italy, Japan, the United Kingdom, Saudi Arabia and India to set up military bases.

Libya is experiencing a civil war as a result of the invasion by the USA-led NATO forces dating back to 2011. Libya, then under the able leadership of Brother Leader Muammar Qaddafi, was peaceful with the Libyan people guaranteed of access to high quality social amenities with the country not having any foreign debt.

Because of her voracious appetite for oil, USA orchestrated the fall of Libya by arming militants and crafting evil conspiracy theories that Libyans were tired of Qaddafi’s dictatorial regime and were demanding for establishment of democratic systems and structures.

Afghanistan, Iraq, Syria and Yemen have been ravaged by wars instigated by USA in the name of “War on Terror”. America’s destruction of Afghanistan began after the 9/11 attack with Washington riding on the paranoia that the Taliban was cooperating with Al Qaeda in promoting terrorism. USA invaded Afghanistan when the 9/11 attackers were from Saudi Arabia!

Iraq was destroyed by USA because the Washington government was eyeing the former’s oil. George W. Bush, then serving as the 43rd USA president, lied to the world on how Iraq had ‘Weapons of Mass Destruction’.

Unknown to many, Iraq had a stockpile of these weapons but destroyed them in 1991 and ceased all its nuclear and biological weapons programmes in the same year due to pressure exerted by USA and her allies. Since then, the Iraqi people are strangers to peace and stability with puppets regime established by the USA. And by the way, if Iraq had such weaponry, would the USA have invaded her?

Syria and Yemen are war-torn states with the USA drooling at the oil fields of these countries. But the shithole USA government claims that the Syrian and Yemeni governments are unpopular with the masses and they must fall. USA financed destitute militants to hold anti-government demonstrations in Syria and Yemen, a similar case with Libya, in the wake of the contorted and highly skewed Arab Spring.

Crafting of propaganda and hatching of conspiracy theories is USA’s well-mastered game. Having faced moments of non-cooperation with the Libyan, Syrian and Yemeni governments, the USA government played the opportunist card, triggered chaos and siphoned the oil while lying on why ‘democratic’ governments must be established in these countries.

The double-faced USA government cannot condemn whatsoever the undemocratic regime in Saudi Arabia. The cooperation between USA and Saudi Arabia dates back to February 1945 when the then US President Franklin Roosevelt met with King Abdul Aziz of Saudi Arabia aboard a US warship.

Roosevelt met with King Aziz on his way to the USA after attending the Yalta Conference on the future of Europe following the end of the Second World War. Since then, USA and Saudi Arabia have been close allies with geopolitical interests and oil being the agenda of the American government.

Saudi Arabia is used as a proxy by USA to generate political instability in the Middle East. Through her military partnership/cooperation with Saudi Arabia, USA finances militants to fight legitimate governments in the Middle East with the objective being to cause confusion and steal the oil. Saudi Arabia has a dubious distinction and distinguished notoriety of arming militants, case in point the current civil war in Yemen. But USA is silent.

Closer home, South Sudan is muddling through a civil war that erupted in December 2013. Recently, the USA denounced South Sudan’s President Salva Kiir and declared him as an ‘unfit partner’. But nobody is questioning the role the USA government has been playing in fueling the civil strife in South Sudan. Remember USA is siphoning oil in Africa’s youngest state.

I bet a deal between USA and Salva Kiir has gone sour and Washington has made an about turn on supporting him and is hell bent on deposing Kiir and establishing another puppet government. Folks, it is the oil.

What do you call a state that interferes with the sovereignty of other states, supports dictatorial regimes and promotes war in the world as a divide and rule strategy to loot natural resources? You call it shithole! Never mind that Africa is shithole but my mother country, Kenya, is the shithole of shitholes.

And by the way, at the recent African Union (AU) Summit in Addis Ababa, African political leaders shelved the idea of demanding an apology from the not-so-well read USA president after he sent them a letter expressing his respect for Africa! African political leaders are compromised and intoxicated by neo-colonialism. But, don’t you see both are shitholes?

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Taking stock of Kenya’s macroeconomic environment: A situational analysis

By Dominic Atika & Sitati Wasilwa

It’s been an unbridled 2017 for Kenya, and the vagaries of the economic scene could never be more prevalent. As the year draws to a close, we figured it would be prudent to sit back and conduct a diagnosis of Kenya’s economic health, stacking our arguments against assertions and reassurances by The National Treasury bureaucrats and the Jubilee administration that our economy remains as resilient as ever.

Quite unforgettably, on the 8th of November this year, the Cabinet Secretary in charge of The National Treasury, Henry Rotich, pompously remarked that “Kenya’s economy remains strong and stable, all economic fundamentals are solid. Kenya is moving forward.” But how true is that? To try and find out, we delve into a detailed analysis of six economic determinants: the national debt, interest rates, corruption, food security, unemployment and elections.

One might want to forgive CS Rotich for having made such an unfortunate statement, especially bearing in mind he has an almost religious obligation to defend the economic agenda of the Jubilee administration, but the numerous economic missteps and mistakes so far made by the Jubilee regime only serve to make that impossible.

One of Kenya’s economic fundamentals that is not only running out of control, but that also seems to be out of place is the country’s level of national debt. According to data by the Central Bank of Kenya last updated September 2017, the total national debt now stands at KSh4.482T ($44.82B).

After the end of the first financial year 2013/2014 presided over by the Jubilee administration, the total national debt amounted to KSh2.422T/$24.22B (47.9 percent of GDP) in comparison with KSh1.894T/$18.94B (42 percent of GDP) for the previous financial year 2012/2013 under the Kibaki- and Raila-led Grand Coalition Government. These figures and data are highlighted in the Annual Public Debt Report 2013-2014prepared by The National Treasury.

Since its inception, the Jubilee Administration has borrowed a record KSh2.588T ($25.88B), an amount far exceeding the country’s level of total national debt from 1963 to 2013. That’s right! Those are fifty good years. Well, the economic fundamentals really are solid!

The sustainability of Kenya’s national debt is now highly doubtful. As documented in the 2017 Budget Review and Outlook Paper published by The National Treasury, the public debt to GDP ratio will be in the region of 59 percent by the end of the 2017/2018 financial year, contrary to the 51.8 percent figure projected in the 2017/2018 Budget Policy Statement.

Even as The National Treasury bureaucrats and the Jubilee administration choose to remain defiant over the country’s national debt situation, the controversial and contradictory statements made by CS Rotich point to an administration living in denial.

For instance, in January 2017, during the release of the Annual Public Debt Management Report 2016/2017, Mr. Rotich stated that the public debt to GDP ratio was projected to stand at 50.7 percent by June 2017. However, the Kenya Economic Report 2017 prepared and published by the Kenya Institute of Public Policy Research & Analysis (KIPPRA) towards the end of May 2017 reveals that by mid-2017, the public debt to GDP ratio stood at 52 percent.

An expected economic growth rate of 4.9 percent for the year 2017, coupled with a total debt of about KSh4.5 trillion ($45B), would ordinarily mean that on an approximate scale, Kenya’s debt to GDP ratio by the end of the year will be slightly above 60 percent.

With available information indicating an increasing level of public debt to GDP ratio, it should be taken into account that there are two fundamentally important fiscal benchmarks that stipulate the ideal level of public debt to GDP ratio.

Apparently, both fiscal frameworks highlight the need to maintain the public debt to GDP ratio at 50 percent or lower. One of these frameworks is the Protocol on the Establishment of the East African Community Monetary Union under the macroeconomic convergence criteria, and Kenya’s Public Finance Management Act.

Possible consequential effects of the high level of public debt that Kenyans must be prepared to face include an increase in the level of taxation informed by the need to shore up revenue for purposes of debt repayment, and the crowding out of private investment as lenders opt to advance credit/loans to the government at relatively higher interest rates, as opposed to lending to private entities at lower rates.

The second economic fundamental that defies and negates Mr. Rotich’s cosmetic sentimental remarks of “solid economic fundamentals” is the nuanced effect of the interest rate cap. With the procedural approval of the Banking Amendment Act of 2016, there have been two schools of thought whose arguments on the cap teeter on the two extreme ends of the continuum.

One argues that for a long time, interest rates in Kenya have been exorbitantly high, while the other premises its argument on the negative effects of the usury laws.

There’s a general consensus among members of the public, perhaps with the exception of the owners of commercial banks, on the need to have lower interest rates that are affordable to the Small- and Medium-Scale Enterprises (SMEs) which play a crucial role in Kenya’s economy, as well as for the low-end borrowers whose financial inclusion in the economy is absolutely important.

From the outset, following the drafting of the Banking Amendment Bill 2016 by Kiambu Town MP Jude Njomo (an ‘evangelical’ propagator of warped economic thought), CS Henry Rotich and the Governor of the Central Bank of Kenya (CBK), Dr. Patrick Njoroge opposed the proposed amendments.

According to the Kenya Economic Update Report by the World Bank released in December 2017, the interest rate cap has had a largely negative impact on the country’s economy. Among the consequences highlighted by the World Bank include:

  • A shift in lending by banks from small borrowers and SMEs to corporate clients.
  • A decrease in the proportion of new borrowers from 13 percent in March 2016 to around 6 percent after the operationalization of the Banking Amendment Act of 2016.
  • Re-allocation of credit from the private sector to the public sector – in 2017, the amount of credit advanced to the government has expanded by 15 percent, compared to 3 percent for the private sector.

Having realized the deleterious effects of the interest rate cap, Dr. Njoroge recently made clear the CBK’s intentions to repeal the cap. Meanwhile, CS Rotich continues to maintain a taciturn approach.

Although he was opposed to the same law in its formative stages, he is on record stating it would only be a short-term measure, even as The National Treasury mulled plans to organize a forum to deliberate on the aftermath of the interest rate cap.

In addition, Mr. Uhuru Kenyatta, in his State of the Nation address in March 2017, acknowledged the “unintended effects” of the cap and promised to review the skewed policy.

In light of these arguments, the sanctioning and enactment of the legislation to cap interest rates makes for a campaign tool meant to win the hearts of the uninformed Kenyan citizenry. It qualifies as a populist economic policy that bears no resonance with Kenya’s economic realities.

The predatory behavior of commercial banks has always been blamed for the perniciously high interest rates in Kenya. But who really needs to take responsibility for the high rates?

Blame it all on the government. It has consistently chosen to run massive budgetary deficits that have now sparked a borrowing spree. And of course the laxity and complacency of the CBK in promoting fiscal discipline among banks, especially before the appointment of Dr. Patrick Njoroge as Governor, is a major factor.

Going into 2018, the interest rate cap must be repealed. Failure to do so will see banks continuing to react to the law and extending as much credit as possible only to the government and other well established entities. SMEs account for the largest proportion of employment opportunities in Kenya, and their limited access to credit due to the rate cap will only exacerbate the unemployment problem.

And of course an analysis of Kenya’s economic well-being would never be complete without an in-depth examination of the venomous effects of corruption. Now, corruption really is the bane of Kenya’s existence. From an exasperated Uhuru Kenyatta bellowing “What do you want me to do?” at a 2016 State House Summit, to a straight-shooting Barack Obama reiterating that “… the fact is, too often, here in Kenya … corruption is tolerated because that’s how things have always been done.”, Kenyans have seen and heard it all.

The statistics paint an even grimmer picture. According to the PwC 2016 Global Economic Crime Survey, Kenya reported a 47 percent incidence of bribery and corruption, the third highest incidence globally. Stack that against a global average of 24 percent, and you have what it makes for an alarming statistic.

In 2016, the Ethics and Anti-Corruption Commission (EACC) reported that Kenya loses KSh600M ($6B) – a third of its state budget – to corruption every year. While CS Rotich disputed that estimate, Mr. Kenyatta went so far as to declare corruption a threat to national security.

Here’s some perspective: The average Kenyan forks out a bribe at least twice in every three encounters with a public official. Corruption in Kenya takes many forms, with asset misappropriation, procurement fraud, accounting fraud, bribery, tax fraud, recruitment and payroll fraud, money laundering, intellectual property infringement, insider dealing, mortgage fraud, espionage and anti-trust law infringement being the most common.

As we wade into 2018, corruption will continue toasting to the most notorious of scandals to rock the Jubilee Administration – the National Youth Service (NYS) scandal of November 2015 – which cost taxpayers KSh1.9B ($19M).

But it’s not the only one. There’s the KSh215B ($2.15B) Eurobond Scandal of 2016. And the Mafia-style heist at the Ministry of Health towards the end of the same year that robbed Kenyans of another KSh5.5B ($55M). And the KSh53B ($530,000) Laptop Tendering scandal. And the KSh50M ($500,000) Chickengate Scandal. Indeed, 2016 was, by every measure, the greatest year for corruption in Kenya.

The fact that Kenya is still grappling with runaway corruption 54 years after independence is perhaps the biggest indictment of every administration since. Now, you might think how to curb corruption in Kenya is the proverbial $64,000 question, but it really isn’t. The doctor’s prescription has always been, and will always be, the same: We’ve got to find the will to demand accountability and integrity amongst ourselves, both as leaders and as a people.

Fast forward to yet another macroeconomic fundamental – food security, or the lack thereof. In 2010, Kenya set out to eliminate food poverty by the year 2020. And yet today, just three years shy of that deadline, at least 40 percent of the country’s population remains food-insecure.

On the 16th of May this year, the government announced a Ksh6B ($60M) subsidy on maize imports to help lower the cost of maize flour. Authorities blamed the shortfall on drought, but evidence suggests it was yet another stark reminder of our government’s endemic failure to plan.

Since independence, we’ve consistently blamed our food insecurity glitches on the same culprits: frequent droughts, exorbitant costs of food production (especially due to high costs of inputs such as fertilizers), steep global food prices and low purchasing power due to poverty.

Following the termination of the maize-subsidy program at the end of October, the government has done well to increase its budgetary allocation toward the purchase of maize from farmers. Its decision to increase fertilizer subsidies to farmers is also laudable, especially given it will most likely help raise maize yields on the back of lower input prices.

However, these are only short-term fixes. The government needs to stare further down the hallway and plan with foresight. We’ve got to start with land reform and redistribution in order to ensure efficacy in food supply and distribution throughout the country.

There’s also a veritable need to embrace policies aimed at bolstering rural investment, promote innovation and invention in the agricultural sector through technology transfer and advisory services, improve food storage facilities and augment irrigation and rainwater management endeavors.

Kenya’s irrigation potential is estimated at around 540,000 hectares, of which only about 105,000 hectares is exploited. It should be emphasized that major crop and livestock production can be tripled by using modern technologies. By developing the Tana and Athi basins and the Lake Victoria shoreline, Kenya can extend the area of land under irrigation by 1 million hectares.

The government’s decision to develop the Galana-Kulalu Food Security Project (touted the largest irrigation project in the country) in Kilifi and Tana River counties to supplement food production from the traditional food basket regions of the North Rift is a good place to start. But until we implement all these strategies, food security will remain a mirage for many Kenyans.

Time to look at unemployment. According to the United Nations Human Development Index (HDI) 2017 report, Kenya’s unemployment rate stands at an ominous 39.1 percent. To put that into perspective, four in every ten Kenyans of working age can’t find meaningful economic engagements.

As our ability to create new jobs tends to lag behind population growth, the shadows of income inequality, dependency, crime and violence continue to loom large, and this on a pro rata basis. As a matter of fact, at 33.1 percent, Kenya’s income inequality rate remains among the highest in the world.

So, what needs to be done to address the unemployment menace in Kenya? Well, our approach has to be multidimensional. As a country, we need to invest in high-quality education, laying particular emphasis on the need to nurture an entrepreneurial culture among the youth.

Sure, we’ve made strides making it easier to do business in Kenya, rising 12 places in the World Bank’s 2017 Ease of Doing Business Index, but we still have more to do. The government needs to take further steps towards lowering the cost of doing business, especially considering 80 percent of jobs created over the past decade have been in the informal sector.

We will now sign out with a cursory look at the effect of elections on Kenya’s economy. Kenya’s election cycle has always been synonymous with political and economic uncertainty. And uncertainty is never good for business, especially for a country whose tourism sector accounts for about 10 percent of her GDP, employing well over 1 million people.

Following election violence in 2007 and 2008, Kenya’s visitor numbers dropped by a third. Most recently, in anticipation of uncertainty following the Supreme Court’s nullification of the August 8, 2017 presidential election, Capital Economics predicted Kenya’s tourism sector would suffer a three percent growth slump. The wait-and-see attitude adopted by investors only serves to make things worse.

These recurring distractions inform the need for electoral justice, full-fledged democracy, adoption of a Parliamentary system of government and an end to the culture of impunity in Kenya.

So, here’s the $64,000 question: Are Kenya’s economic fundamentals as solid as CS Rotich would have us believe? You be the judge.

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The Libyan Slave Market in Perspective

By Sitati Wasilwa

“Slavery as an institution that degraded man to a thing has never died out. In some periods of history it has flourished: many civilizations have climbed to power and glory on the backs of slaves. In other times slaves have dwindled in number and economic importance. But never has slavery disappeared.” – Milton Meltzer

The recent revelation by CNN about slavery in Libya is an affirmation that this inhumane act is inherently embedded in humanity.

Across civilizations, slavery has transcended different generations with its form and nature varying from crude, to subtle and more nuanced ways of human oppression.

From the ancient civilizations to modern times, slavery has been used as a mechanism to enrich the oppressor and impoverish the oppressed. The oppressed – the slaves – are subjected to forced labour used for the production of goods or offering services to enrich the lives of the oppressor – the slave masters.

In ancient civilizations, slavery was less of a commercial affair with slaves mainly captured to render domestic services to the royalty and political leadership of the kingdom, chiefdom, fiefdom, aristocracy or any other form of headship or socio-political organization that was in existence.

With increased realization of the benefits from trade and trade related activities, the trajectory of slavery shifted and incorporated the commercial aspects that led to the exchange of human beings in markets with monetary value attached to them.

Presence of various forms of social discrimination such as slavery, racism, xenophobia and tribalism in modern times can only be understood from a historical perspective. It is through historical account of events that the foundations of these social processes can be uncovered.

Emergence and re-emergence of the afore-mentioned forms of discrimination is not an event but a process.

Existence of vestigial structures from the previous social, economic and political institutions that promoted and encouraged these negative social processes guarantee their re-occurrence based on the historical cycle and existence of social fault lines.

The historical cycle, in simple terms, refers to the act of history repeating itself which was well stated by the intellectually gifted German, Karl Marx that “history repeats itself first as tragedy and second as farce.”

Therefore, to understand the social and economic basis of the current Libyan slave trade, it is fundamentally important to revisit the pre-colonial and post-colonial social and economic organization as well as institutions in Libya.

Pre-Colonial and Post-Colonial Libya

During the pre-colonial period in Libya, slavery existed in the North African country. Additionally, Libya was also used as a major transit route to ship the slaves captured from Africa’s interior into other parts of the world especially the Middle East and the Far East.

Slave trade that involved the major Libyan cities and towns was aided by the Indian Ocean slave trade and the Trans-Saharan slave trade.

Historical records indicate that slave markets for slaves sold during the Indian Ocean trade were in Persia, and the cities of Medina and Mecca.

The case was the same with slaves traded during the Trans-Saharan trade who were mostly sold in the Middle-East, in the Arabian sphere of the world.

Historians collectively refer to the trade in slaves during both the Indian Ocean trade and the Trans-Saharan trade as the Arab slave trade due to the nature of the trade and destination of the slaves.

Tripoli, Libya’s capital city, was a major slave trade route and one of the largest slave markets in Northern Africa during the pre-colonial period. In this period, the slaves were sold in public a situation similar to the recent account of slavery events as documented by CNN.

Post-colonial Libya has been characterized by two major political events that have shaped the country’s economic, social and political landscape. The hallmark of both political events was regime change.

The first event was the bloodless coup d’état under the leadership of Colonel Muammar Qaddafi that toppled the monarchy led by King Idris I. The revolution and leadership of Qaddafi culminated in the establishment of the Great Socialist People’s Libyan Arab Jamahiriya that lasted from 1977 to 2011.

Libya’s second political event was the Libyan civil war that began in 2011 after the invasion by the NATO forces led by USA, United Kingdom and France that led to the murder of Qaddafi and subsequent regime change through the establishment of the National Transitional Council.

Qaddafi’s administration and the Jamahiriya government presided over a period of social and economic prosperity.

Since the 2011 civil war that was driven and fueled by sinister motives of the NATO states, Libya’s social, economic and political systems have collapsed.

Geographically, Libya borders Chad, Niger and Sudan to the south. Libya’s southern population especially in the Fezzan region has a significant composition of black people. A good proportion of Libya’s black population in the south is made up of migrants whose main countries of origin (before the NATO sponsored rebellion in 2011) were Niger and Chad.

In terms of development, the Fezzan region lags behind other regions in Libya though more developed than Niger and Chad.

Being more developed than Chad and Niger, this acted as a pull factor that occasioned the immigration of Africans from Niger and Chad into southern Libya.

With the outbreak of the civil war instigated by the USA and her allies, Fezzan region and other parts of Libya have become ungovernable with rampant incidences of lawlessness.

A stable Fezzan region under Qaddafi guaranteed sustainable livelihood at least for a significant number of Africans in the northern side of Niger and Chad.

Collapse of the economic, social and political systems in the Fezzan region and largely Libya has led to a state of economic desperation and destitution for the populations of Niger and Chad that depended on and reaped from the economic prosperity and socio-political stability of Libya under Qaddafi.

The consequence of the collapse of the social, political and economic order in Libya and the Fezzan region is the massive number of migrants seeking to get to Europe via Italy.

This high number of migrants who have fallen victim to slavery depended on Libya’s economic prosperity under Qaddafi. Economic prosperity in Libya during Qaddafi’s era trickled-down to Niger and Chad and this managed to keep low the number of migrants from these countries.

Current Situation

Currently, Libya has no substantive government in place with the leading political entities being the UN-backed Government of National Accord (GNA) led by Prime Minister Faiez Serraj with its base in Tripoli and the Libyan National Army (LNA) under the leadership of General Khalifa Haftar.

Besides these two political groupings, there are other political formations that are factions of the leading political units as indicated by a report published by Al Jazeera.

At the moment, there are at least 700,000 migrants in Libya as estimated by the International Organization for Migration (IOM). A larger proportion of these migrants are on their way to Europe and they mostly originate from Niger, Chad, and Sudan among other West African countries such as Nigeria and Cameroon.

With lawlessness prevailing in Libya due to socio-political and economic instability, the various political groups ranging from the UN-backed and “internationally recognized” GNA to other militia organizations have resorted to illicit economic activities for survival.

Among the illicit economic activities include smuggling/trafficking of people, smuggling of fuel and the illegal mining of gold.

According to a report by the International Crisis Group, smuggling/trafficking of people in Libya generates annual revenues ranging between $1 billion and $1.5 billion. The same report documents that smuggling of fuel across Libya generates about $2 billion per year with fuel being sold at $0.02 in the black market lower than the official price set at $0.12.

It is the over $1 billion worth economic activity of smuggling/trafficking migrants across Libya that is the genesis of the slave trade.

Smuggling and trafficking of people in Libya has been taking place since 2012 with no substantive government in place. The smuggling has since degenerated into slave trade with the captured migrants being treated savagely.

Emergence of slave trade in Libya can also be partly attributed to legal and policy measures adopted by the European Union and the acclaimed Government of National Accord to intercept the migrants on their journey to Europe.

The resultant effect has been the retention of the migrants in Libya by the smugglers and traffickers of people. With a massive supply and glut of migrants in their retention facilities, the human smugglers and traffickers in Libya have resorted to sell them through public auctions.

A fundamental concern in the wake of slave trade in Libya is whether the ‘Africa Rising’ narrative is more of a myth than reality of which the former holds.

If Africa is indeed rising, then the benefits from the social, political and economic development generated by ‘Africa Rising’ ought to be witnessed in all African countries with the lives of the economically vulnerable Africans improving significantly.

‘Africa Rising’ is mythical as well as a misrepresentation and misstatement of facts since it is only a few African countries and a certain cadre of African people that are on the rise. If Africa was rising collectively, then economic conditions in Niger and Chad would be very conducive such that there would be no or extremely few migrants crossing Libya seeking to get to Europe.

Way Forward

Repatriation of the migrants to their countries of origin is only a temporary measure. The African Union must take responsibility and ensure that countries where immigrants originate from have stable and functioning economies that work for all.

Foreign non-African institutional entities such as the European Union, the International Organization for Migration and extensively the United Nations must show full commitment by working with governments where migrants originate from to address the ‘push’ factors.

The UN must stamp its authority on countries like the USA that promote foreign invasion and subjugate the territorial integrity of other states which is a violation of the UN Charter. The unnecessary civil wars and civil unrests have done more harm than good and the crises facing humanity at the moment could be avoided if the self-anointed “world prefects” such as USA chose to prioritize and pursue peaceful means to solve conflicts.

Slavery and smuggling/trafficking of people should be highly criminalized with very high costs of punishment attached to the promoters of this vice.

Dealing with slave trade in Libya calls for a multi-pronged approach including an end to the nonsensical foreign invasions and promotion of tangible socio-economic development in countries such as Niger, Chad among others.

Slavery must be condemned and it must fall including human trafficking!

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Privatization won’t solve Kenya’s sugar industry woes

By Sitati Wasilwa

In the first week of November, the High Court declined to stop the privatization of the five state-owned sugar firms. This implies that the government will proceed with the sale of Nzoia Sugar Company, Sony Sugar, Chemelil, Miwani and Muhoroni sugar companies.

As highlighted in the privatization plan of the afore-mentioned sugar firms, the government through the Privatization Commission will sell 51% of the total stake of these companies to strategic investors, 24% to farmers and employees and the remaining 25% will be sold later through an initial public offering (IPO) when these firms begin to make profits.

The privatization policy is one of the pillars of the Washington Consensus edifice of which the latter is premised on the neoliberalism ideology. The two, the Washington Consensus and neoliberalism, are tenets and sub-sets of the free market economic dispensation.

Advocates of the free market ideology, who are also known as market fundamentalists, argue that state-owned enterprises (SOEs) are inefficient and that the government should not play an active role in the economy apart from the provision of security and the institutionalization of property rights.

Their arguments are anchored on the economic ideas of Adam Smith through his analogy of the “invisible hand”. Market fundamentalists hence frown upon the “visible hand” of the government in the economy.

The neoliberalism frenzy and craze is associated with the presidency of Ronald Reaganand the premiership of Margaret Thatcher. The free market is a utopic notion since governments will always play a critical and active role in the economy.

Washington-based institutions such as the World Bank and the International Monetary Fund (IMF) have always recommended countries to adopt the Washington Consensus policy package as “shock therapy” to their economic woes.

This occasioned developing countries especially in Africa and Latin America to fashion this policy prescription in the 1980s and the 1990s with most of them still flirting with the same economic policies (privatization, deregulation and trade liberalization) at the moment.

Reasons for Privatization of Sugar Firms

Privatization of the five state-owned sugar firms is geared towards revitalizing the sugar industry especially in the wake of the COMESA free trade agreement that will lead to the total collapse of the sugar industry as a result of the importation of cheap sugar.

Under the COMESA free trade agreement, the Kenyan economy is open to other COMESA member states which have ratified this trade protocol. These states are hence guaranteed to access the Kenyan market without being subjected to any form or kind of duty requirements or quota (s).

It is on the basis of this trade protocol that Kenya has been consistently seeking for sugar safeguards from COMESA since 2003. The sugar safeguard granted to Kenya in February 2017 was extended by two years after it expired.

The COMESA sugar safeguard granted to Kenya is expected to insulate the farmers against the effects of cheap imported sugar and upon the expiry of the safeguard, it is expected that the five state-owned sugar enterprises would have been privatized.

Many (including government officials) believe that privatization of the sugar firms will lead to the production of relatively cheap sugar and of course increase the total amount of sugar that is locally produced.

Currently, Kenya’s average annual total sugar production stands at 600,000 metric tonnes against the country’s total annual demand for sugar averaging 800,000 metric tonnes. This leaves a deficit of 200,000 metric tonnes that is addressed through the importation of sugar.

There is talk that the high cost of producing sugar in Kenya has been a major factor that has led to the dwindling fortunes of the country’s sugar industry. When compared to other sugar producing countries that are signatories to the COMESA free trade agreement, it is pretty clear that the cost of producing sugar in Kenya is quite high.

For instance, the Kenya Sugar Directorate notes that it costs an average of $146 (at current exchange rate) to produce a tonne of sugar in Uganda, Tanzania, Sudan, Egypt, Malawi, Swaziland and Zambia. In Kenya, production of a tonne of sugar costs an average of $442 at current exchange rates.

The high cost of producing sugar in Kenya eventually makes the processed commodity to be highly priced domestically and externally hence Kenyan sugar cannot favorably compete in the external markets especially in the COMESA member states.

But will privatization of the five state-owned sugar enterprises lead to relatively lower costs of production and production of relatively cheaper sugar?

Key Observations & Crucial Lessons

Privatizing the sugar firms without drawing lessons from similar past practices is an exercise in futility. There is need to interrogate the successes and failures of firms that were initially state-owned enterprises and later on privatized.

Specifically, in the case of the sugar industry, comprehensive analysis following the privatization of Mumias Sugar Company has to be carried out to establish how effective and efficient this company has operated since its transition from a state enterprise to a public company in 2001.

In the last three financial years, Mumias Sugar Company has recorded losses amounting to Kshs.15.24 billion. This is in contrast with the Kshs.3.1 billion channeled to the company for the last two years to bail it out from the financial challenges that it is facing.

The situation is similar with other public companies listed on the Nairobi Securities Exchange that were previously state-owned enterprises. They include Uchumi Supermarket, National Bank of Kenya, Kenya Airways and Kenya Power whose privatization has been characterized by financial woes.

It should be noted, however, that the government still possesses significant ownership in these companies, including Mumias Sugar hence forming a basis for the bailout programmes by The National Treasury.

At this juncture, it is critically important to put forth fundamental questions in a bid to question the essence of privatizing the state corporations: should the government retain some ownership in the privatized firms? By the government having a certain percentage of ownership in the privatized firms, does this serve as a loophole for embezzlement of finances from these entities? Is full privatization of state-owned enterprises a guarantee for better efficiency in their operations?

The ‘Mumias Experiment’ indicates that privatization may not guarantee efficiency in terms of production of sugar including lowering the cost of producing the same commodity. Minimal presence of government and majority of ownership by private individuals and entities has led to the near collapse of the country’s largest sugar miller.

If at all privatization was to be the answer and elixir to the problems of inefficiency associated with state-owned enterprises then all of them would be generating high returns and making profits while minimizing their costs of operation.

From the preceding statement, a pertinent issue that arises centres and borders on the nature of the so-called strategic private investors who own the largest stake in these commercial entities once they are privatized. Who are they? Do they conspire, connive and act in cahoots with corrupt politicians to squeeze financial life out of these formerly state-owned enterprises?

With politics, progressive or retrogressive, determining the economic trajectory of a country or region/county, it cannot be disputed that the wanton nature of Kenya’s politics is largely responsible for the financial problems facing the privatized Mumias Sugar Company.

Even with the privatization of Mumias Sugar, the political hawks and white collar conmen have not been deterred from denting and wrecking the operations of this firm.

The bailout programmes by The National Treasury can only be termed as ‘cosmetic economics’. Acting on directions from the powers that be, The National Treasury bureaucrats have decided to play politics with the revitalization of Mumias Sugar Company.

On one hand, money is disbursed to help the ailing Mumias Sugar Company but on the other hand, politicians go behind the scenes to demand for money channeled to this firm!

In addition, the resuscitation of Mumias Sugar Company has degenerated into a political chess game with the sugar firm equated to a pawn!

The failed ‘Mumias Experiment’ is likely to be the state of affairs with the five state-owned sugar enterprises earmarked for privatization.

Way Forward for the Sugar Industry

As the privatization of the state-owned sugar enterprises gains momentum, attention must be paid to certain fundamentals of which failure to address them will lead to the total collapse of the sugar industry.

One of the foremost issues that must be addressed is the subsidization of the activities related with the production of sugar. The ‘Mumias Experiment’ reveals that since its privatization, there have been weak subsidization programmes to significantly cut down on the cost of producing sugar.

Unless privatization of the sugar industry is accompanied by subsidization schemes, Kenyan sugar will still be highly priced in markets within the COMESA region and beyond.

The second fundamental issue that must be addressed is the political wretchedness that has clouded the sugar industry.

Going forward, four scenarios play out with specific reference to Kenya’s collapsing sugar industry. Firstly, a privatization programme in which the government still has a stake in the sugar companies is bound to create more economic misery and lead to total failure of the sugar industry.

Secondly, the national government may go on with the privatization plan but cede its stake in these enterprises to the county governments based on two reasons. One, agriculture is a devolved function and two, the previous privatization ‘experiments’ in which the national government has a percentage of ownership have been characterized by unending political interests, a genesis for embezzlement of financial resources.

The third scenario, as proposed by a few people, is the abandonment of sugar-cane farming. It may be fruitful to shift from sugar-cane farming to other agricultural activities but this will negatively affect Kenya’s balance of payment position because the volume of sugar imports will rise.

Fourthly, the national government can still own the sugar enterprises but focus on subsidization and elimination of cartels and the political interests.

If the national government is truly committed in resuscitating the sugar industry that is wallowing and sinking with a debt burden of Kshs.50 billion, then it has to totally clear this debt and stop playing cheap and petty politics.

In the event that county governments are incorporated in the management of these sugar processing enterprises, they must pursue subsidization policies with two main objectives at hand: increased production of sugar with enough surpluses for exportation, and production of cheaper sugar.

Otherwise, blatant, blunt and hell bent privatization without addressing the requisite fundamentals is all but an economic charade and worst of all, an economic bluff!

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The Resistance Movement must Birth the Third Liberation

By Sitati Wasilwa

Regarded as an enigma in Kenya’s politics, former Prime Minister Raila Odinga’s contribution to the political and economic liberation of the country cannot be understated.

Loved and loathed by many, and whose brand of politics cultivates the Raila mania frenzy and elicits the passionate hatred that is Raila phobia, the scion of Kenya’s first Vice President was instrumental in birthing the Republic’s Second Liberation.

The hallmarks of the Second Liberation were the re-introduction of multi-party politics in 1991, after the landmark repealing of the famous Section 2A, and the promulgation of the current progressive constitutional dispensation 19 years later in 2010.

Unfortunately, the full implementation of the Republic’s progressive Constitution has been hijacked by political forces nursing the Moi-era hangovers and keen on promoting the status quo.

In his quest to ascend to the presidency, Mr. Odinga’s political journey has been episodic.

These episodes range from his own political mistakes, rigged presidential elections, re-uniting with erstwhile political nemeses and making unexpected political declarations like the historical “Kibaki Tosha” not forgetting the detentions he was subjected to by Kenya’s second president, Daniel Arap Moi, a corrupt oligarch.

Having fervently championed for the realization of the Kenyan Dream through various political vehicles from the Forum for the Restoration of Democracy (FORD) to the National Super Alliance (NASA), Mr. Odinga’s political career takes a homestretch but the 72 year old firebrand politician seems not to be giving up on his dream for a better Kenya.

This follows his latest political move to transform the NASA coalition into a ‘National Resistance Movement’.

Kenya’s Liberations

The tenets that informed the struggle for the First and Second Liberation were solely anchored on the need for political and economic emancipation of the oppressed Kenyans.

With the first struggle being the fight for the Republic’s independence, it was envisaged that the life for the common man – the average Kenyan; the hoi polloi – would reflect the political and economic liberation that was granted by the British imperialists 54 years ago in 1963.

After independence, however, it quickly turned out that Jomo Kenyatta’s administration was in fact a disgraced institutional set up, a colonial relic for that matter, whose mission was the promotion of crony capitalism through corruption and illegal acquisition of public resources.

Ever wondered why Jomo Kenyatta became wealthy and other heroes of the First Liberation such as Bildad Kaggia, General Baimunge among others died while struggling to unchain themselves from the manacles of poverty? Jomo Kenyatta and his cronies were the enemies within.

Initiatives and activities intended to spur economic growth and development during Jomo Kenyatta’s era were largely based on political affiliation with the regime’s sycophants and loyalists rewarded with a number of ‘projects’.

Jomo Kenyatta’s crackdown on political dissenters such as the Jaramogi Oginga Odinga, and the assassination of fiery revolutionaries such as Pio Gama Pinto and J. M. Kariuki as well as gallant politicians like Tom Mboya and Ronald Ngala was an affirmation of the existence of an imperialist under a Black man’s skin.

In a nutshell, Jomo Kenyatta’s presidency was characterized by political and economic exclusion that resulted in a few illicitly wealthy demagogues, millions of economically destitute patriots and deeply disillusioned political leaders whose aspirations for a politically and economically liberated Kenya were thwarted.

Moi’s presidency was an assortment of a political pantomime and despotism largely due to the inferiority complex and paranoia that Kenya’s longest serving president suffered from.

Arap Moi religiously followed Jomo Kenyatta’s footsteps coining the dubious philosophy dubbed as the “Nyayo Philosophy” meant to promote peace, love and unity. However, it turned out that the ideological maxim of Nyayoism actually propagated economic mismanagement and political exclusion with the old man’s paranoia concentrated on fixing the dissenting voices and amassing illicit wealth.

It was during his presidency in the 1980s and early 1990s that the struggle for the Second Liberation took shape. The Forum for the Restoration of Democracy (FORD) – originally founded by the Jaramogi Oginga Odinga, Phillip Gachoka, Masinde Muliro, Martin Shikuku, George Nthenge, and Ahmed Bamahriz – exerted pressure on Moi to institute political and economic reforms.

One of the critical junctures of the Second Liberation was in 1991 when Daniel arap Moi bowed to pressure and repealed Section 2A of the Constitution that led to the re-introduction of the multi-party political system. However, 26 years later, the Republic is littered with political parties that are not founded on definite ideologies and whose lifespan is directly depended on its founder/leader.

The second critical juncture of the Second Liberation was the political obliteration of KANU in 2002 that culminated in the formation of the NARC government with Mwai Kibaki as president.

Despite reviving the country’s moribund economy, Kibaki failed to deliver a progressive constitution to Kenyans as promised, fashioned tribalism and of course allowed corruption to blossom.

This led to the 2007/08 post-election violence in which the presidential election was rigged in favor of Mr. Kibaki. This event was the third crunch time after the dawn of the Second Liberation whose eventuality was the formation of the Grand Coalition government with Kibaki as president and Raila Odinga as Prime Minister.

An outstanding achievement of the Kibaki and Raila led coalition government was the promulgation of the current Constitution in 2010. The Republic’s Constitution is wholly progressive but its key component is devolution, a politico-economic concept advocated for by Mr. Odinga.

A politically progressive doctrine that was to be included in our national Constitution but was quashed by Mwai Kibaki’s camp and William Ruto during the constitution making process is the Parliamentary system of government.

Such a system would be ideal for the Republic in view of the tribal political formations that compete for the presidency in the case of the current Presidential system.

Four and a half years under the Jubilee administration, corruption has been rife with no tangible effort made to tackle this vice despite the existence of a number of governance institutions as stipulated by the Constitution.

Under the presidency of Uhuru Kenyatta there have been several attempts to drag the country to the dark days of Moi and Jomo Kenyatta. His administration has effectively put into use large doses of propaganda (the PR we’ve witnessed) that is confusingly and annoyingly packaged as “development record”. This effective use of propaganda mimics the classical Communist propaganda.

But it isn’t a surprise since the Jubilee Party has been closely benchmarking with the Chinese Communist Party. This is the genesis of the propaganda lately escalated by the involvement of international PR firm, Cambridge Analytica.

Jubilee Party’s propaganda bears semblance with similar “PR” schemes engineered by Daniel Moi who even went to an extent of publishing the Kenya Times newspaper to religiously brainwash the citizens with political garbage.

Fast forward, following the flawed repeat presidential election presided over by the broken and rotten Independent Electoral & Boundaries Commission (IEBC), the country remains deeply divided with nearly half of the electorate disillusioned by the electoral body.

It is a stinking shame to have the ignominious IEBC with its crooked commissioners presiding over an election even after the chairman, Wafula Chebukati, laid bare the intrigues and machinations within the commission.

With electoral malpractice and political hubris having transformed the NASA coalition into a ‘National Resistance Movement’, the country awaits with bated breath to see ‘what next’. This is certainly the political zero hour to birth the Republic’s Third Liberation.

The Third Liberation

Since the ‘Uhuru Park Declaration’ whose prime highlight was the formation of the ‘National Resistance Movement’, Jubilee propagandists have framed the movement as a “rebel movement” keen on pursuing its political agenda by instigating violence. This is absolutely a warped view and a figment of imaginations of the hell-bent Jubilee Party surrogates.

Apart from Raila Odinga pursuing his own political interests, it is true to state that the Republic urgently needs social, political and economic reforms in line with the national Constitution and through a referendum.

There is need for the broken healthcare system to be fixed. The argument that county governments are responsible for healthcare is fundamentally flawed and utter nonsense.

As long as we don’t have a responsible national government keen on instituting a healthcare system for all, even the devolution of health services will fail fantastically.

By the way, Rwanda is on course to fully implementing the universal healthcare system while East Africa’s ‘most progressive’ state is grappling with endless strikes by health workers. The Republic’s third estate is subjected to poor health incommensurate with the taxes they pay to the national government.

In addition, the Third Liberation must institutionalize the Parliamentary system of government which effectively works with Kenya’s national political architecture that is purely based on shuffling the tribal cards.

The Third Liberation should be a movement out to liberate the country from the yoke of corruption both at the national government and the 47 county governments. Why should we have people running governments yet they allow corruption to flourish under their watch?

This is sanctioning cronyism and theft of public resources, a clear violation of the social contract that binds the relation between the governor and the governed. Kenyans must certainly be angry enough about corruption.

Corruption’s twin problem, that is the existence of the ‘permanent government’ often referred to as the cartels must be annihilated with the Third Liberation. The crony culture propagated by the cartels must be zealously fought if the Republic is to progress socially, economically and politically.

Furthermore, the Third Liberation must bring to an end the culture of defective electoral processes and systems that perpetuate political exclusion. The electoral body’s affairs must be managed by morally upright Kenyans.

Just like the IEBC, all public institutions have a chronic deficiency of people with unrivalled integrity which is a malady that must be rectified by the Third Liberation. This will be made possible by religiously sticking to the provisions of Chapter 6 of the Republic’s Constitution on Leadership and Integrity.

But who will make the Third Liberation a reality? Will it be the politicians or the people’s power?

Politicians or the People’s Power?

With the ‘National Resistance Movement’ being the brainchild of Raila Odinga, he is expected to naturally provide leadership to the cause of this political movement.

Of keen interest, however, is whether his co-principals – Kalonzo Musyoka, Musalia Mudavadi and Moses Wetang’ula – will fully embrace Odinga’s latest political strategy. The three senior politicians never fought for the Second Liberation and hence are ‘strangers’ with the former Premier’s revolutionary ideologies.

In the 1980s and 1990s, Kalonzo Musyoka, Musalia Mudavadi and Moses Wetang’ula were dining with the corrupt despot, Daniel Moi. Wetang’ula’s flirtation with the oligarch came after he represented some of the orchestrators of the failed 1982 coup in court.

Even as I highly doubt the commitment of the three to lead the way to the Third Liberation, all the forward-thinking Kenyans must come forth and seize the moment to liberate the Republic through non-violence means.

Peaceful revolutionary messages cannot be effective if at all there is no critical mass. I come across majority of the common folks lamenting about poor governance and all the malfeasance rampant in the national government and the county governments but who end up voting along tribal lines or whose ballot decision is artificially wrecked.

Fermentation of the Third Liberation calls for a new generation of leaders. Perhaps more youthful leaders need to take a pivotal role by clearly pointing out the socio-political and economic ills and endlessly agitate for transformation of the Republic.

Disappointments, however, are bound to occur since a significant number of Kenyan youth are ethnic fundamentalists. Informal education acquired through the primary socialization process is a breeding mechanism for highly spirited tribalists. No wonder formal learning institutions are ethnic enclaves.

All in all, talking we must at this moment but the embers of the Third Liberation should not be allowed to flicker out. The oppressed majority must seek for political and economic emancipation through peaceful means.

Viva Troisieme Liberation! Viva Mouvement des Personnes!

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