Connect with us

Op-Eds

REAL RAILWAYS FOR ROAD RACKETS: Re-imagining Kenya, one year into the SGR

A bridge over the Likoni Channel? Unlikely (there’s a mafia in the ferry business). A railway line between Garissa and Isiolo? Unthinkable (we haven’t figured out how to eat from it). But we’re $6 billion in debt to an unnecessary American expressway and an overpriced Chinese railway, the logic of the first sabotaging the other. 120 years since the building of the Kenya-Uganda railway, RASNA WARAH counts the cost of missed opportunities and handshakes in Nairobi that build bridges to nowhere.     

Published

on

REAL RAILWAYS FOR ROAD RACKETS: Re-imagining Kenya, one year into the SGR

When Uhuru Kenyatta and his former rival, Raila Odinga, announced the “Building Bridges” initiative (ostensibly to promote peace and harmony in the country) following their famous touchy-feely handshake on the 9th of March, many people in Kenya’s coast region wondered when a bridge would be built at Likoni to ferry passengers to and from the mainland to Mombasa Island. Various suggestions appeared on Twitter, from retractable bridges of the type that are found on the Thames in London, to sky-high bridges that would allow ships to cross the Likoni Channel without hindrance. These suggestions, some of which were no doubt expressed by those who know a thing or two about how bridges are built, will most likely be ignored by the powers that be.

For years residents of Mombasa have wondered why the government has not built a bridge at a place that is crying out for such infrastructure. How long will local residents and tourists continue to rely on ferries to carry passengers and vehicles across the Likoni Channel? Are ferry cartels hindering the building of such a bridge? Who has the most to lose if such a bridge is built?

Conspiracy theories abound. Some say that powerful cartels have a monopoly on ferry purchases from abroad and so do not want to lose out on lucrative deals if more people start using the bridge rather than the ferry. Others speculate that the owners of certain airlines that have made a fortune from flying passengers from Nairobi to Ukunda’s pristine beaches in Diani will have the most to lose from a bridge at Likoni as tourists would be tempted to fly instead to Mombasa on a competitor’s airline and then take the road/bridge to Ukunda.

For years residents of Mombasa have wondered why the government has not built a bridge at a place that is crying out for such infrastructure…Conspiracy theories abound…powerful cartels have a monopoly on ferry purchases from abroad and so do not want to lose out on lucrative deals…Others speculate that the owners of certain airlines that have made a fortune from flying passengers from Nairobi to Ukunda’s pristine beaches in Diani will have the most to lose…

These theories might be true but it is equally true that our short-sighted policy makers have been unable to see the link between building actual bridges and prosperity. Bridges have linked people and made trade possible between different states and communities for centuries. Cities around the world have prospered and grown around bridges. Would Kolkata be a different kind of city without its landmark Howrah Bridge (now known as the Rabindra Setu Bridge)? And would Istanbul be the vibrant, cosmopolitan city it is today if the imposing Bosphorus Bridge linking Turkey’s Asia side to Europe had not been built? In some cases, bridges have become major tourist attractions. Imagine Paris without its delightful bridges across the Seine, London without the Tower Bridge or New York without the picturesque Brooklyn Bridge.

Death of a railway

As Kenyans marked the first anniversary of the controversial Standard Gauge Railway (SGR), dubbed the Madaraka Express – hailed as a success story by the Jubilee government despite the billions of shillings Kenyans now owe the Chinese who built it, and which may take decades to repay – another conversation regarding transport infrastructure emerged on Twitter. On one of those nights when you randomly wonder about the state of your nation, and worry about things like inflated electricity bills and why the price of Supaloaf bread has jumped so quickly from 27 shillings to 50 shillings, I asked my Twitter followers to imagine what it would be like to have a railway line that links Lamu to Malindi in the North coast, Mombasa and Kwale on the South coast. This tweet was prompted by a wedding invitation to Diani that I had declined because I don’t like driving on the Malindi-Mombasa highway and also because the prospect of catching the ferry from Mombasa to Likoni always fills me with dread.

The reaction was massive and instantaneous. Dozens of Twitter followers said that such a railway line would not only attract tourists but would also be a huge boost to the local economy as trade between different parts of the Coast increases and as more settlements emerge along the railway line, just as they did when the Uganda Railway was built more than a century ago. Some said that the Lamu-Kwale rail corridor would make coastal people more accessible to each other and would therefore help in “building bridges” between different communities.

The story of the decline of the Uganda Railway (later renamed variously as the Kenya and Uganda Railway, the East African Railways, the Kenya Railways and eventually Rift Valley Railways) is itself one of myopia on the part of policy makers. When the East African Community split in 1977, making East African Railways defunct, Kenya Railways became a fairly efficient parastatal that was tasked with running the country’s rail network. Up until the early 1990s, the parastatal ran a relatively reliable (but slow) daily passenger rail service from Nairobi to Mombasa and back. I remember the days when a night train journey on Kenya Railways was a romantic affair, complete with white linen bedding and silver cutlery.

However, by the mid-90s, the sleeping and dining experiences on this train had deteriorated considerably, but it was not as if it they could not be salvaged. The Mwai Kibaki administration made the mistake of first giving a concession for the management of the railway to a South African-led consortium, which killed what remained of the century-old railway, and later charging an Egyptian consortium with the impossible task of resurrecting it. In-fighting and complaints about the South African consortium’s lack of investment in the railway eventually led to the premature termination of the 25-year concession. Meanwhile, another Kibaki-initiated flagship transport corridor, the Lamu Port and South Sudan Ethiopia Transport (LAPSSET), has yet to take off.

The railway suffered another major blow after the Kibaki administration exited in 2013. Uhuru Kenyatta’s Jubilee administration did not care to revive the dying railway and instead opted for the expensive SGR option funded by Chinese loans, even though a World Bank study had estimated that the upgrading and refurbishment of the existing railway line would have cost less than one-fifth of what the SGR was going to cost the Kenyan taxpayer. In addition, the upgrading of the existing railway could have been funded by levies from the cargo itself rather than through huge borrowing from foreign banks. Besides, if the country was going to borrow money to build a railway, could it not have borrowed it for building a new network in areas where there are no train services?

Interestingly, the government has also contracted a US construction company, Bechtel, to build an expressway from Nairobi to Mombasa, which will in essence undermine and negate the original reason given for building the SGR – to move larger amounts of cargo faster. As the economist David Ndii has pointed out, the combined national debt arising from the SGR and the new expressway is a whopping $6 billion, or about a third of the country’s total foreign debt. How long will it take Kenyans to repay this?

One also wonders why the existing rail network, which is of immense historical and sentimental value, was abandoned in favour of a completely new one. Countless books have been written about the “Lunatic Express” and the toll it took on those who built it. Stories of heroic British engineers, man-eating lions and resilient Indian coolies have been captured in several books and films.

Interestingly, the government has also contracted a US construction company, Bechtel, to build an expressway from Nairobi to Mombasa, which will in essence undermine and negate the original reason given for building the SGR – to move larger amounts of cargo faster.

The history of British colonialism and Indian settlement in Kenya would be quite different if the railway had not been built. In fact, Nairobi would not exist today if railway engineers had not stopped at what was then known as Mile 327 to contemplate the daunting task of ascending the Kikuyu Escarpment into the Rift Valley. Nairobi owes its existence to the railway line that completely transformed urbanisation patterns in Kenya and opened up the country for European settlement – and eventual colonisation.

Although initially intended as a colonial vehicle for the exploitation and export of the country’s raw materials, the railway eventually developed its own ecosystem sustained by an army of engine drivers, station masters, ticket agents, vendors, baggage and cargo handlers, cooks, stewards and passengers. A job in the railways was considered stable and prestigious as it came with other perks, like housing. (Kenyan lawyer Pheroze Nowrojee, whose grandfather worked as an engine driver on the Uganda Railway from 1903 till 1933, writes nostalgically about that era in his book, A Kenyan Journey.) Sadly, the railway staff quarters in Nairobi, like the railway itself, have been allowed to deteriorate or to become the victim of land grabs.

Things are different in India. The Indian government did not neglect the vast railway network that it inherited from the British. On the contrary, it strengthened and expanded it. India’s rail network, which reaches almost all parts of this huge country, is the fourth-largest rail network (half of it is electrified) in the world, covering some 121,407 kilometres. Indian Railways, which is managed by an entire government ministry – the Ministry of Railways – employs some 1.3 million people and generated $29 billion in revenues last year. It is considered by most Indians as the most reliable and affordable means of transport and is used by rich and poor alike.

Trains have a democratising influence on society. On roads it is easy to distinguish rich users from the less well-off ones, the former in their luxury cars and the latter in crowded buses and matatus. But travelling by rail is different. On the London Underground, which covers 270 stations across the city and its suburbs, it is not unusual to find the Mayor of London seated next to ordinary working class Londoners.

India’s rail network, which reaches almost all parts of this huge country, is the fourth-largest rail network in the world – half of it is electrified – covering some 121,407 kilometres. Indian Railways, which is managed by an entire government ministry – the Ministry of Railways – employs some 1.3 million people and generated $29 billion in revenues last year.

There is also something about being able to use a mode of transport that allows you to get up and stretch your legs or to read a book in comfort. Trains, especially of the electric kind, are also among the most environmentally sustainable forms of transport.

The questions that much of the country’s population that is not served by a railway line are asking are: what has prevented Kenya from expanding its rail network across the country? Why are the benefits of trains only viewed through the prism of cargo from the port of Mombasa and not passengers across the country? How long will it take before there is a rail service from Garissa to Isiolo or from Kisumu to Kakamega? Or how about one from Machakos to Thika? Or a light-rail service within the city of Nairobi itself that would ease road traffic? It may not happen in my lifetime, but imagine the possibilities if these scenarios were to become reality.

What has prevented Kenya from expanding its rail network across the country? Why are the benefits of trains only viewed through the prism of cargo from the port of Mombasa and not passengers across the country? How long will it take before there is a rail service from Garissa to Isiolo or from Kisumu to Kakamega? Or how about one from Machakos to Thika? Or a light-rail service within the city of Nairobi itself that would ease road traffic?

These are the kinds of bridges we need to build, not the hollow kind promised by Uhuru and Raila, which are premised on the lie that a handshake will end uneven development in the country.

See all comments
Rasna Warah

Ms Warah, the author of War Crimes, a sweeping indictment of foreign meddling in Somalia, and A Triple Heritage, among several other books, is also a freelance journalist based in Malindi, Kenya.

Continue Reading

Op-Eds

KENYA BUDGET 2018/19: It’s time for a taxpayers boycott

The Kenya Budget 2018 has drastic implications on national and regional stability, on the Kenyan economy and on Kenyan workers. Its projections contradict data shared in previous Economic Surveys; it makes patently false claims, for instance, about the decline in domestic credit, to justify doling out billions to already well-provisioned sectors, notably manufacturing. But more than anything else, it is quite simply a perfect script for more waste and theft. By L. MUTHONI WANYEKI

Published

on

KENYA BUDGET 2018/19: It’s time for a taxpayers boycott

It’s time for a taxpayer’s boycott in order to evaluate what is increasingly sapped out of us through tax and against what’s disgorged out of us through the theft and waste of our money. Let’s compare the facts, according to the government’s own Economic Survey 2018 and this week’s budget speech.

This year’s budget aims are meant to align with, and support the Jubilants’ so-called ‘Big Four Agenda’ – boosting manufacturing activities, enhancing food and nutrition security, achieving universal health coverage and supporting the construction of at least 500,000 affordable houses by 2022. Bear in mind, however, that the first Jubilant administration, through its Economic Transformation Plan, also had a focus on agriculture and manufacturing.

Last year, the real added value of agriculture shrunk by 3.5 percent to 1.6 percent. This was blamed (as usual) on the lack of rainfall. True, there were shocking decreases in production of key crops – coffee’s production dipping by 11.5 percent and tea’s by 7 percent with only horticultural production going up. But there was an overall increase in the value of marketed production of Ksh.28.6 billion for the agricultural sector. So why did the real added value shrink? What happened?

There’s no doubt that Kenya’s efforts to expand social protection are worthwhile. Reforming social insurance, for instance. Or expanding social assistance to vulnerable groups. But social protection is about risk mitigation – preventing the already precarious from tipping over into even more precarious. Social protection is not about growing jobs, enabling livelihoods and improving returns from employment. It’s also not about ensuring that the intent to improve access to quality social services translates into actual access to social services.

The real added value of manufacturing shrunk by 1.9 percent to 0.2 percent. This was blamed (also as usual on the extended electoral process, high production costs and competition). Note that credit extended to manufacturing actually increased – by Ksh 36 billion, no less. Yet there were shocking decreases in the levels of key manufactured products – except for maize and soda (!). What happened?

Regardless of what happened last year, to fix these sectors now, our Treasury proposes the following:

For the agricultural sector (amongst the usual pleas to move away from rain-fed agriculture and so on), to put about 700,000 acres under large-scale production by public-private partnerships (PPPs). No mention is made of where these additional acres are to come from – when land theft, fragmentation and scarcity is the source of so much national tension already. Maybe the President’s family intends to return the immense tracts of public land the founding President appropriated for himself?

For the manufacturing sector, contradictions abound. On the one hand, Kenya’s speedy accession to the African Continental Free Trade Area is praised. On the other hand, regional (and other) competition is being dealt with by ‘re-negotiations’ and ‘reviews’ of the sub-regional trade arrangements we are already committed to. Plus the rather cavalier raising of customs duties on anything we’re deemed capable of producing – to no less than 35 percent (!) on everything from iron and steel to paper, plywood, textiles and vegetable oils. This, we are informed, should raise us an additional Ksh.27.5 billion (not to mention the ire of our neighbours in the sub-region). Free trade is only good when it’s good for us, apparently.

Moving on to the financial sector: the Treasury had much to tell us about the supposedly negative effects of the interest rate cap. It has, we were told, made banks ‘shy away’ from would-be borrowers, who have also pushed depositors towards an expanded range of non-interest earning deposit accounts. It has also, we were told, slowed growth in credit afforded to the private sector.

Yet the Economic Survey for 2017 told us otherwise. As mentioned above, credit to the manufacturing sector grew last year – by Ksh.36 billion. Credit to the construction sector also grew last year – by Ksh.5.1 billion. Overall, domestic credit increased by 7.9 percent in 2017 – including an increase of credit to the private sector by 2.4 percent. And, despite interest rates remaining fairly steady, deposit rates went up as well!

 Credit to the manufacturing sector grew last year – by Ksh.36 billion. Credit to the construction sector also grew last year – by Ksh.5.1 billion. Overall, domestic credit increased by 7.9 percent in 2017 – including an increase of credit to the private sector by 2.4 percent. And, despite interest rates remaining fairly steady, deposit rates went up as well!

But no…the Treasury has decided this experiment in making banks less usurious must end. It will be seeking to repeal the now infamous Section 33B of the Banking (Amendment) Act. For those worried about small borrowers, especially for small and medium-size enterprises, have no fear. The new, combined Biashara Fund is here (which’ll combine the three special funds for SMES owned by women and the youth).

And, just so we’re clear that Treasury isn’t, in fact, on the side of usury, it will be seeking to institute a ‘Robin Hood’ tax – charging a 0.05 percent tax on all bank transfers of Ksh.500,000 or more to go towards public health. Which we might be happy about if they came from banks and not us (as individuals and businesses). And if Treasury wasn’t also increasing the (already outrageous) tax on all mobile money transfers by two percent to 12 percent. What the good Lord gives with one hand he’ll certainly take away with the other.

Oh, and in case we missed it, instead of the progressive income tax increase on high-earners we had expected, now everybody gets a tax increase. The Employment Act is to be amended to impose a housing tax on all of us – an additional 0.5 percent will be taken from every formal sector worker, matched by an additional 0.5 percent from the employer virtuously to go towards housing.

Our spending target is to come in at just under Ksh.2.56 trillion. The aim apparently being to reduce our deficit from 7.2 percent to 5.7 percent while keeping our debt to gross domestic product ratio just below 50 percent. This spend target is slightly under our spend for 2017 – which sat, at the end of the day, at just under Ksh.2.78 trillion. Not controlled for theft and waste obviously

Our spending target is to come in at just under Ksh.2.56 trillion. The aim apparently being to reduce our deficit from 7.2 percent to 5.7 percent while keeping our debt to gross domestic product ratio just below 50 percent. This expenditure target is slightly under our spending for 2017 – which sat, at the end of the day, at just under Ksh.2.78 trillion. Not controlled for theft and waste, obviously.

With regard to theft and waste, the Treasury announced a bunch of moves to make public procurement more to scale and transparent, with significant allocations to all criminal justice institutions now involved in the ‘multi-agency’ effort against theft and waste. But it’s hard not to be cynical given the absolute lack of attention apparently paid to improving efficiencies and prudence.

There’s no doubt that Kenya’s efforts to expand social protection are worthwhile. Reforming social insurance, for instance. Or expanding social assistance to vulnerable groups. But social protection is about risk mitigation – preventing the already precarious from tipping over into even more precarity. Social protection is not about growing jobs, enabling livelihoods and improving returns from employment. It’s also not about ensuring that the intent to improve access to quality social services translates into actual access to social services.

That translation has been utterly undermined by the breadth, depth, prevalence of the theft and waste of public money that prevails. Treasury needs to convince us that it’s taking that theft and waste seriously. Sorry, the measures announced just don’t cut it.

It’s time for a taxpayers boycott. Really. There’s no taxpayer who is not absolutely and completely embittered by what we have to contribute. Because what we contribute is going to theft and waste.

Continue Reading

Op-Eds

KENYATTA’S WAR ON CORRUPTION: Words won’t cut it, the budget is the corruption

Corruption in Kenya isn’t about greedy procurement officers, fiddling civil servants, crooked businessmen, shady bankers, thieving politicians. These are merely creatures of an inherently corrupt political system. The current crisis was triggered by the capture of the public finance management system by what we call ‘cartels’. Now broke and in debt from all the looting, Treasury has officially turned against the people. By JOHN GITHONGO.

Published

on

KENYATTA’S WAR ON CORRUPTION: Words won’t cut it, the budget is the corruption

The three key issues Kenyans are talking about today when they survey the political scene are corruption; ‘the handshake’ between Raila Odinga and Uhuru Kenyatta; and, the fate of Deputy President William Ruto as he prepares for a run at the presidency in 2022. For his part, Mr. Kenyatta came out of the handshake in March with a renewed push against the theft and plunder that has characterised his regime thus far. He has issued strong statements against corruption; announced that procurement officers would be asked to step aside and vetted before resuming their positions. Previously he’d even announced that lie detector machines would be introduced into the public service to promote integrity. Most recently, he pronounced public officials (starting with himself) would be subjected to lifestyle audits and that all major public procurements would see their details published in the media including the names of the companies winning the tenders complete with their beneficial owners. All strong stuff especially coming on the back of a series of breathless exposés in the mainstream press of the looting of a range of government bodies, the National Youth Service (NYS) merely being the most egregious and colourful. The scandals have exasperated Kenyans.

Oddly though, all the bold pronouncements are yet to capture the public imagination. Indeed, Kenyans seem sceptical about the President’s anti-corruption crusade. This is partly because he has historically been big on talk and small on action where this particular vice is concerned. Secondly, there is suspicion regarding its timing. Why do now what you were unwilling to do between 2013 and 2017? Thirdly, there is the rather scattershot character of the anti-corruption initiatives announced. This has led some to observe that a series of tactical moves are being employed without a coherent strategy. For example, it is self-defeating to attempt a serious anti-corruption campaign in a society as open as Kenya’s while alienating the media and civil society at the same time. Public opinion is mobilised by civil society, civic society (the churches, professions etc) and the media – not by politicians no matter how well-meaning.

This is partly because Kenyatta has historically been big on talk and small on action where this particular vice is concerned…There is suspicion regarding the timing of the latest war on corruption. Why do now what you were unwilling to do between 2013 and 2017?

The broad scepticism that has greeted Kenyatta’s efforts thus far was best articulated by one of the country’s most experienced progressive politicians, Senator Jim Orengo of Ugenya, speaking before the Senate on May 31st. He warned that the real corruption in Kenya was happening at the highest levels but we Kenyans were afraid to call it out. He essentially asked the president and other top leaders to look around themselves and they would find that the real rot sits in cabinet with them: “In the inner sanctum of power there are people sitting there who should not be sitting there.”

The truth of the matter is that 50 percent of the fight against corruption is related to perceptions. Despite extraordinary efforts to manage the media, the current campaign is yet to capture the public imagination. Until it does Mr. Kenyatta is rolling a stone uphill watched by a disbelieving population. As I said, part of the problem is that it’s clear he doesn’t have a coherent strategy, which makes even simple efforts all the more difficult. Secondly, Kenyatta and his colleagues are victims of an even more serious strategic misinterpretation.

Corruption in Kenya isn’t about greedy procurement officers, fiddling civil servants, crooked businessmen, shady bankers, thieving politicians. These are creatures found in all societies. The issue at hand in the Kenyan context is that these players are born of a system of politics and governance that is itself inherently corrupt; one in which the thieves and those who facilitate them thrive. Indeed, if one were looking at where the next scandals will come from one doesn’t need an army of technicians with polygraph machines. This week the Cabinet Secretary for Finance presented to parliament a Ksh.2.5 Trillion (US$25 billion) budget. The thieving in Kenya starts right here. It is built into the budget. When the budget of the NYS shot up from US$50 million to US$250 million in Jubilee’s last term it was clear that this wasn’t a measure of the NYS’s absorptive capacity or a vast upgrading of this programme but the creation of what was literally a slush fund created to be stolen. This ‘theft-ready’ budget is a product of our politics. Last week the Auditor General, Edward Ouko, told Reuters that corruption across all levels of government threatens the integrity and basic functioning of the state. He said that the corruption was ‘coordinated at a high level’.

This week the Cabinet Secretary for Finance presented to parliament a Ksh.2.5 Trillion (US$25 billion) budget. The thieving in Kenya starts right here. It is built into the budget. When the budget of the NYS shot up from US$50 million to US$250 million in Jubilee’s last term it was clear that this wasn’t a measure of the NYS’s absorptive capacity or a vast upgrading of this programme, but the creation of what was literally a slush fund created to be stolen. This ‘theft-ready’ budget is a product of our politics.

It is time to accept that Kenya’s corruption crisis may in part be caused by the deliberate collapsing of our public finance management system – chunks of it are owned by what have come to be known as ‘cartels’. When this happens the challenge you face is not chasing bribe-soliciting cops on the beat but fixing a situation where the budget itself is the corruption. There are generally three types of corruption: petty corruption that is often extortion by public officials for small considerations to overlook minor infractions or expedite the delivery of services already paid for in your taxes. Grand corruption that typically involves senior officials conspiring with private sector players to skim off public works projects of one kind or the other. There is a third type of ‘corruption’ that I call looting or economic delinquency on the part of the elite. In this type of thieving the pretence of a project to skim off is set aside as elites raid public coffers with impunity and pocket billions. This causes the kind of macroeconomic effects we are seeing in Kenya as our foreign debt soars on account of the looting of a small elite.

It is time to accept that Kenya’s corruption crisis may in part be caused by the deliberate collapsing of our public finance management system – chunks of it are owned by what have come to be known as ‘cartels’. When this happens the challenge you face is not chasing bribe-soliciting cops on the beat but fixing a situation where the budget itself is the corruption.

*******

In 1998 the fight against corruption, which had been a global advocacy campaign since the early 1990s by organisations like Transparency International, entered the mainstream of the global development agenda. There was no development programme in any developing country that didn’t have an anti-corruption aspect; that didn’t say something about transparency, accountability, basic freedoms etc. Even the World Bank whose legal department had previously blocked its officials from mentioning ‘corruption’ broke with tradition and joined the bandwagon. Previously corruption was described as project ‘leakages’ and ‘slippages’.

What had actually happened is that with the fall of the Berlin wall the opening up of political space meant that corruption, bribery and other forms of skulduggery that had been essential to governance during the Cold War found themselves being reported in newly free media, by a public free to associate and speak their minds. Between 1998 and 2008 a series of corruption scandals shook governments across the world. From Kenya to Germany, Peru, South Korea etc. In Latin America alone between 1998 and 2008, 11 governments fell due to corruption scandals that morphed into political crises of one sort or the other. By the start of this century anti-corruption researchers such as the respected Chilean economist Dani Kauffmann (now of the Natural Resource Governance Institute), argued to Moises Naim in Foreign Policy that with regard to the fight against corruption “Much was done, but not much was accomplished. What we are doing is not working.”

Indeed, corruption was increasingly blamed for all societal ills. More recently we’ve seen corruption scandals cause political shakeups in India, Mexico, Brazil, Bulgaria, Thailand, Guatemala, South Koreas etc. In Kenya we face a crisis in the health and education sectors; we are unable to create jobs for a majority of our youth. Unsurprisingly, corruption is the easiest to blame for what are sometimes failures caused by incompetence, a lack of capacity and the inability of the ruling elite to define the national interest separate from their own commercial interests.

Between 1998 and 2008 a series of corruption scandals shook governments across the world. From Kenya to Germany, Peru, South Korea etc. In Latin America alone between 1998 and 2008, 11 governments fell due to corruption scandals that morphed into political crises of one sort of the other. By the start of this century anti-corruption researchers…argued…that with regard to the fight against corruption: “Much was done, but not much was accomplished. What we are doing is not working”.

In Kenya, a serious effort to delineate personal interests from national ones would go a long way to dealing with our corruption problem. Conflict of interest was entrenched in our public service by the infamous Ndegwa Commission report of 1972 and we’ve been paying for it ever since. Most recently it is the poor who are paying most for it. The budget this week saw a cash-strapped regime under the gun of the IMF increase taxes on basic commodities in part to pay for the cynical profligacy of the elite since 2013. Ironically, Kenya’s constitution has created a legal infrastructure that should make the kind of economic delinquency and looting that’s in evidence impossible. But breathing life into a constitution requires political will that still seems to be lacking. In the meantime anti-corruption campaigns will be embarked on full of drama, gimmicks, speeches and technical fixes to problems that have much to do with the fact that our elites refuse to let governance institutions work, as they should. As a result, they are struggling to engineer the public sympathy and support essential to make the changes that need to happen.

Research by Juliet A. Attelah

Continue Reading

Op-Eds

KENYA’S LOOMING RESOURCE CURSE: Dancing to Machiavelli’s drum

Fed a daily news diet of scandal and sensation, and the choreographed drama of minions arrested and driven off in sleek SUVs, the Kenyan public’s attention is daily diverted from the far more serious resource scams, planned and conducted by the men in the shadows. In Lamu and Turkana, the theft of billions of dollars is already underway. By MIRIAM ABRAHAM.

Published

on

KENYA’S LOOMING RESOURCE CURSE: Dancing to Machiavelli’s drum

The large hall was decorated with African art from the 54 Member States of the African Union. Singers and dancers from several African countries were entertaining dignitaries as they filled their plates with delicacies from the motherland. It was after all, Africa Day. The 25th day of May when we celebrate the formation of the Organization of African Unity (now African Union). And on the four screens around the large hall was the theme for this year: ‘Winning the Fight Against Corruption: A Sustainable Path to Africa’s Transformation.’

What a thematic choice by the African Union, I thought to myself. I was struck by the choice of words especially beginning with the positive: ’winning’. But my optimism was short-lived as the representative of Nigeria was called up to the podium to give remarks as the “champion” of the anti-corruption theme. I quickly looked up the latest Transparency International Corruption Perception Index to see the success of President Buhari’s fight against corruption, only to find that Nigeria had slipped from its 2016 ranking by 12 places to rank No. 148 out of 180 countries surveyed in 2017. Why, I wondered, didn’t the organisers select champions from countries that have seen significant improvement in their index score such as Côte d’Ivoire and Senegal or Botswana that has continuously ranked top in Africa. But then again: This Is Africa.

At this rate, I was expecting the Kenyan representative to be the next in line as the co-champion, standing at 143rd ranking on the Index! We were, fortunately, spared that particular embarrassment. As I listened to each speaker glorify African unity and deliberately evading the theme of the day, I could not stop thinking of the contradictions of our continent. We often have big aspirations that we parade but never implement – “winning the fight against corruption” being very high up on the list.

These empty aspirations were eloquently mimed by President Uhuru Kenyatta during his address to the nation on Madaraka Day.  Like most Kenyans, I remained unmoved by his speech. Have we not seen this circus before? Did we not vet officials in the Judiciary and the Police before? Any lessons? Is this not just another game in elite self-preservation?

To be fair though, as a country, we have not outdone Saudi Arabia’s anti-corruption charade. Yet. We recall how late last year under the supervision of Crown Prince Mohammed bin Salman, hundreds of billionaires including over 50 from his own royal family were detained at the luxurious Ritz Carlton hotel, a gilded prison if ever there was one. There were claims of torture and abuse. The detainees reportedly signed off their wealth to the tune of billions in exchange for their release. In the meantime, the same Crown Prince allegedly splurged $500m to buy a yacht and a chateau outside Paris for $300m. It has been billed as the world’s most expensive home.

The charade by the Saudis has the feel of Kenya, albeit on a different scale. On 28 May, we watched as tens of high ranking officials were rounded up and escorted to court in top-of-the-range vehicles on charges of stealing money from the National Youth Service programme. It was a well- choreographed show; we have seen it before. Like the Saudis, we are fighting corruption for Machiavellian reasons. We all know too well the politics of our country. We hold “elections”; the coalition that “loses” cries foul. In order to govern in a polarized environment, the winning faction of the elite agrees to share the loot and, in the process, ditch a few people to give room to the new entrants. Statecraft. It is what “the men from the shadows” as John Githongo calls them in his article, One Week in March: Was the Handshake Triggered by the IMF?, engineer with the nod of the international community, so called, to maintain the status quo. To paraphrase from one of Niccolò Machiavelli’s works, one should not attempt to win by force what can be won by deception.

On 28 May, we watched as tens of high ranking officials were rounded up and escorted to court in top-of-the-range vehicles on charges of stealing money from the National Youth Service programme. It was a well- choreographed show…We are fighting corruption for Machiavellian reasons. We know all too well the politics of our country. We hold “elections”; the coalition that “loses” cries foul. In order to govern in a polarized environment, the winning faction agrees to share the loot and, in the process, ditch a few people to give room to the new entrants. Statecraft. It is what “the men from the shadows”…engineer with the nod of the international community.

One can see this art of deception playing out with the white elephants of Lamu county.  Amu Power Company, a consortium that includes the Chris Kirubi-affiliated Centum Investments, has been awarded the tender to build the Lamu Coal Power Plant. In addition to the grave environmental concerns raised by community activists in Lamu, the approved Ksh 200 billion (US$ 2 billion) project does not make financial sense.

In a detailed analysis by Tony Watima in the Business Daily, the project’s high fixed cost of Ksh 36.2 billion per year is raised by its capital-intensive nature. While this would have made sense if the project was meeting real demand, it turns out that the additional demand is fictitious, a product of the Jubilee government’s fantastical ambitions. While real demand will stand at 2,500 Mw by 2022, Jubilee set itself a target of securing installed capacity at 5,000 Mw. Between reality and fantasy lies the opportunity for mischief. Thus, in the case of the Amu project, Kenyans will be paying almost solely for idle capacity. It will mean that each consumer will see an increase in their bill by Ksh 600 every month that would go directly to the Amu investors.

Amu Power Company, a consortium that includes the Chris Kirubi-affiliated Centum Investments, has been awarded the tender to build the Lamu Coal Power Plant. In addition to the grave environmental concerns raised by community activists in Lamu, the approved Ksh 200 billion (US$ 2 billion) project does not make financial sense…Kenyans will be paying almost solely for idle capacity. It will mean that each consumer will see an increase in their bill by Ksh 600 every month that would go directly to the Amu investors.

Amu is billed as the most expensive fixed cost project among the power generators. An additional 1,000 Mw of power that is excess of demand – and therefore idle capacity. In other words, we are incurring US$ 2 billion in debt to finance a white elephant. These costs do not include the potential loss of income from the fishing activities of the local community, and tourism. They also do not include the known health impacts from coal burning, the most toxic and dangerous pollutant of all fossil fuels.

If the government is serious about “winning the fight against corruption” as this year’s African Union theme pledges, then it must begin by being transparent about the Lamu Coal Power Plant. It must also be transparent about how it handles the export of crude oil from Turkana, lest we quickly join the millions of Africans for whom oil and minerals only yield the proverbial resource curse.

It must also address the systemic manifestations of corruption that begin from the budget preparation process. As a former senior official in a state institution, I witnessed first-hand how numbers are padded to inflate the actual requirements for any project. Requisitions of products that were in abundance in warehouses were made. Goods not needed at all were included in the budget. Consultancy fees, costs for transportation of goods and official travel were common lines that were padded with excess fat that would be “chopped” by officials, as my Nigerian friends would say.

The best lie detectors – probably also procured through corrupt means – cannot replace the dramatic shift in culture that is required in the genuine fight against corruption. Respect for professionalism, integrity, transparency and the rule of law are the fundamental cornerstones of a “corrupt free” Kenya. These are the same principles that this government, at its highest level, has frequently and gleefully violated. Targeting mid-level officials without touching the top-ranking thieves will only be scratching the surface. It will be classic Machiavellism. Or what Muthoni Wanyeki in her recent article eloquently called a ‘game of smoke and mirrors’.

The best lie detectors – probably also procured through corrupt means – cannot replace the dramatic shift in culture that is required in the genuine fight against corruption. Respect for professionalism, integrity, transparency and the rule of law are the fundamental cornerstones of a “corrupt free” Kenya. These are the same principles that this government, at its highest level, has frequently and gleefully violated.

If we as the tax payers fall for the deception, we will be cheering the smokescreen magicians. We will find ourselves questioning the #STOPTheseTHIEVES protesters, wonder why they are disrupting the supplications made at the recent Prayer Breakfast. And in a few weeks, just like we have done with the theft and electoral injustice at the IEBC, we will forget these scandals. Well, until the proceeds from the crude oil imports and the siphoning of money through the Lamu coal plant reach peak levels and “the men from the shadows”, the real rulers of the country, deliver baits on another NYS scandal that the media will gullibly headline, as the looting continues elsewhere and the elite entrench their political and financial positions.

As our African-American brethren say: Stay Woke!

Continue Reading

Trending

Copyright © 2018 The Elephant. All Rights Reserved.