Sunday, 12 October 2014

My Economic Vision for Kenya

For over 50 years we Kenyans have worked hard to establish a just and democratic society. Through blood sweat and tears we have managed to make significant achievements in our struggle for democracy, the most notable of which was the enactment of a new constitution that is considered one of the most progressive constitutions in the whole world.

Our decades long preoccupation with democratic reforms was absolutely necessary because democracy and freedom are the foundations of a just and prosperous nation. And it is not over. We must remain ever so vigilant because democracy is not self executing and there will always be elements in our society just as it is any free society that seeks to claw back our freedom and subjugate our people.

But freedom and democracy must be accompanied with ecomomic development without which our freedom and democratic gains are rather meaningless. Unfortunately for us, our nation's pace of our economic growth and development has not matched the pace and achievements of our democratic gains.

By and large our economy remains rather rudimentary compared to that of developed countries. Agriculture is still the backbone of our economy and our industrialization efforts have not been as successful. And our dream of becoming a middle income industrialized nation by the year 2030 will always be at risk of becoming a pipe dream if we dot exert ourselves to make it a reality.

More than anything, and now more than ever, our economy requires fundamental reforms. The same reforming zeal we have had in transforming our nation from the totalitarian state it once was to the stable democratic state that it is today, must be brought to bear on our economy. In order to better meet our needs and satisfy our wants more equitably, we must reorganize our economy for greater efficiency and reenergize it for greater productivity.

Agriculture has been the backbone of our economy since time immemorial but Kenya simply cannot become rich through agriculture even though it remains a vitally important sector of our economy. Despite great efforts over many years, the transition to an industrialized economy has by and large eluded us.

The tragedy of our industrialization endeavor does not necessarily lie in our apparent failed attempts at industrialization but in our inability to determine a clear direction for our industrialization efforts that balances ambition with practicality. Industrialization just for the sake of industrialization has proven an unttainable goal which has only served to demoralize us and instilled a sense of despair.

I believe that the greatest resource available to any nation is its people and that is something that we're blessed  super abundantly with. Thankfully, over the years, we have invested rather substantially in the education and good health of our people and that is something we should be proud of and must continue to do and strive to do even more. The problem however is that we have we way too many young people who through no fault of their own are unable to find gainful employment despite their best efforts.

Personally, I do not subscribe to that tired 'kazi ni kazi' notion anymore. That self-defeatist cliché has been used to masquerade our inability to create enough decent jobs for our young people and quite frankly, should be deleted from our lexicon. The youth deserve better and they are demanding real jobs that pay living wages.

I am firm believer that if we reorganize our economy properly and reenergize it with the right incentives and investments, then the economy will grow and generate the right jobs with living wages. To be sure, the government does not create employment itself; it is a well functioning economy that produces employment. It is however the primary responsibility of any legitimate government, to maintain macroeconomic stability, promote economic growth, and oversee the creation of decent jobs.

Nothing however in my view, and this is a view that is shared all Kenyans, has done more to undermine and devastate our economy and our society than the scourge of corruption. Corruption is our greatest undoing. All our masterful economic plans, all our innovative policies, and all our determined efforts have all been undermined by corruption. A lot of economic gains and achievements have been reversed by corruption. Corruption is Kenya's kryptonite.

Governments have come and gone, each making a solemn commitment to fight corruption and each has failed to live up to its sworn commitment to end corruption. This reality begs the most provocative question of our time: is corruption invincible? For many of us Kenyans the answer to that question is pretty straightforward.

But the truth is that deep within our souls, we're hoping that we're wrong and earnestly praying for the ghost of corruption to be exorcized. Deep within our hearts we know that corruption is the greatest hindrance to the prosperity of our nation. Deep within our hearts, we want corruption defeated.

We may have no faith at all in our politicians but everyday we're consciously and subconsciously fighting corruption. The evidence strongly suggests that deep down we Kenyans firmly believe that corruption is not invincible. Clearly, we have a lot faith in ourselves and a lot of fight within ourselves. What we lack is a visionary leader with integrity of heart who will galvanize our people, harness our resolve and resources and lead us in the fight against corruption.

For far too long our politics has been characterized by tribalism. And tribal bigotry has only served to cloud our judgement as a nation. There's nothing inherently wrong in being proud of our ethnicities. It is very human. However, ignorance, selfishness, intolerance, and hate have corrupted our righteous ethnic pride and the very essence of our politics.

The fight against corruption cannot be won as long as our people continue to see it through the corrupted eye (prism) of tribalism. On the other hand, the fight against corruption cannot be succesful as long as their is no political will. I believe that all that is required to stump out grand corruption is political will. I am also of opinion that stumping out corruption within the police service is quint essential to winning the war on corruption even though the police are considered small fish in the fight against corruption.

No matter how innovative or ingeneous our ideas and  economic plans are and no matter how much effort we put to make those ideas work, it will all be in vain as long as corruption continues to rule every aspect of our society as it does today. Putting an immediate stop to corruption therefore is a precondition for the economic reforms that we need to put in place for the transformation of our economy.

The transformation that our economy must undergo in order to achieve the participatory growth that we aim for also requires a new approach in the way we manage the economy. That new approach requires collective openness not just to new economic ideas and philosophies but also openness to the inevitable change it will bring.

The transformation that our economy needs is a strategic change in its orientation. Kenya cannot become rich by remaining an agricultural economy. Agriculture is certainly an important economic sector because it is the sector that feeds our nation and employs nearly 75 of our total labour force. Be that as it may, agriculture cannot become rich by being an agricultural economy.

What I am proposing therefore is for us to upgrade the agricultural sector and leverage it to also upgrade and expand our industrial sector in hopes of bringing it to per with agriculture. The full potential of our industrial sector has never been fully realized. A lot of our industrial sector is considered informal but most of that industrial activity can and should be upgrade through supportive policy and investment action to become an important driver of economic growth.

Be that as it may, our industrial and technolohical base remains rather small at present and incapable of becoming the leading sector of our economy or of generating sufficient jobs to absorb a significant portion of the ever increasing masses of well-educated job seekers which represent an economic resource that remains largely untapped.

As you will all agree, these job seekers possess many valuable skills and talents and are capable of providing a bewildering array of services to the government and to industry. In order to tap that enormours resource and create employment we should re-orient our economy in the direction of services.
Currently, our economy is structured in such a way that impedes the growth and  development of the services sector. This annormally has gutted entreprenurship and excluded the economic participation of otherwise highly qualified job seekers.

Given the gravity of the problem of high unemployment and the vast untapped potential among the unemployed and given the economic and growth potential of the services industry it makes perfect economic sense to transform our agrarian economy into a service economy.

Such a re-orientation implies far reaching reforms to government regulations and a reorientation of relevant government programmes to meet the needs of service industries more effectively.

Upgrading agriculture and industry plus re-orienting our economy to become a service based economy I believe is the economic transformation that our economy needs and I also believe it can lead to what I call participatory double digit economic growth in our short-to-medium growth prospects that is required to achieve the prosperous industrialized middle income country that aspire to be by the year 2030.

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