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Fiddling, while Kenya burns

The Jubilee administration gambled on mega-infrastructure projects to expand the economy. It has borrowed heavily to finance them. Over the past five years, it has conjured up a misleading set of economic data that paints a rosier picture than the grim reality now confronting the country. What is this fantasy in aid of? By DAVID NDII

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Fiddling, while Kenya burns
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After all the hullaballoo, and the brazen manipulation of the vote on Uhuru Kenyatta’s presidential veto of parliaments proposal to defer VAT on fuel for another two years, you would be forgiven to think that the government scored big in the battle to shore up its terrible and rapidly deteriorating finances. It did not. Much to the contrary, the melodrama was an inconsequential sideshow.

Alongside the president’s memorandum, the Treasury tabled a supplementary (i.e. revised) budget that which elicited screaming headlines: the government had “slashed” by a whopping 55 billion shillings from Sh. 3.026 trillion to 2.971 trillion. A critical reader would immediately have noticed that a 1.8 percent reduction hardly qualifies to be a “slashing” — trimming would have been accurate. Of note, the supplementary budget the Treasury did not provide a complete budget revision, but only a high level expenditure summary with five budget lines.

But the Treasury also published its regular Budget Review and Outlook (BROP) paper that contains the detailed budget data. As is customary with our National Treasury, the numbers in the two tables are not identical. Even the numbers in different tables of the BROP are not identical, although the differences are not material— it’s mostly sloppiness, and occasionally, sleight of hand. I follow the BROP figures (See table below) as they are more comprehensive and also the more up to date of the two, if only by two days. Two things to note.

Government Fiscal Projections FY 2018/19 - 2021/22

First, the expenditure cuts are less than the revenue forecast which is revised downwards by Sh. 96 billion, while expenditure is revised downwards by Sh. 83 billion. Even though the 10 billion difference is not such a big sum, it’s unclear why the government would go to such lengths to table an austerity budget that increases the deficit.

More significantly, the revenue forecast is still unrealistic. The budget was based on revenue growth of 31 percent, comprising of 30 percent and 36 percent increase in tax and non-tax revenues respectively, which has now been scaled down to 25 percent, with tax and non-tax revenue forecast down to 24 and 28 percent respectively. These forecasts are out of touch with reality. Tax revenues increased only three percent and non-tax by 12 percent for a total revenue increase of four percent. This, as we will see shortly, is not an anomaly—it is a significant trend.

The budget was based on revenue growth of 31 percent, comprising 30 percent and 36 percent increase in tax and non-tax revenues respectively, which has now been scaled down to 25 percent, with tax and non tax revenue forecast down to 24 and 28 percent respectively. These forecasts are out of touch with reality.

In its current financial circumstances, it is not just sensible that the government be prudent, it is imperative. There will be no harm done if revenue exceeds target, but unrealistic revenue forecasts result in government spending money it does not have. This is how the government ends up accumulating pending bills, which, according to the private sector lobby KEPSA, are now in the order of Sh. 200 billion.

Trend growth gives you a revenue forecast of Sh. 1.55 billion. An optimistic one, assuming a most favorable economy and factoring in tax rises, would double the growth rate to 8 percent, still comes to Sh. 1.62 trillion. I would work with Sh.1.6 trillion.

In its current financial circumstances, it is not just sensible that the government be prudent, it is imperative…Unrealistic revenue forecasts result in government spending money it does not have…The government ends up accumulating pending bills… now in the order of KSh 200 billion.

Herein lies the problem. The Sh.1.6 trillion revenue forecast is Sh. 250 billion short of the revised recurrent budget. Interest cost (Sh. 400 billion), pensions (Sh. 90 billion) are non-discretionary (i.e. mandatory) and the wage bill (Sh. 444 billion) which does not give you much room to manoeuvre already add up to Sh. 930 billion. This leaves a balance of Ksh. 660 billion to fund counties (Sh. 367) and the national government’s operations and maintenance (O&M) outlays (Sh. 530 billion) totaling Ksh. 960 billion.

The only question here should be where the axe falls. There are only two options either the axe falls on the national government, or to share the cuts with the counties. The latter is obviously more sensible than the former. The equitable way of doing this is to net out the counties wage bill which is about Sh.140 billion, and share the balance proportionately. This math works out to 33 percent of the national governments O&M budget and the transfer to counties net of wage bill which translates to national government O&M budget of Sh. 202 and counties Sh.78 which means that the transfers to counties reduce from Sh. 376 to Sh. 218 billion. This is the reality that the government has refused to face. It should also be readily apparent that the tax measures that the government rigged through parliament are not a solution to its financial woes.

The Jubilee administration bet the farm on mega-infrastructure projects to expand the economy and has borrowed heavily to finance them. Infrastructure investments are supposed to crowd in productive private investment which in turn expands the tax base, which in turn generates the revenue to pay the debts. But far from increasing, the tax take is falling. The preliminary data treasury has published shows a sharp decline to 15.4 percent last financial year, down from 17 percent in the previous one. A 1.6 percentage-point decline in a year looks improbable— it is more likely that they have over-estimated GDP. This and the reason why, will be confirmed shortly. Still even the one percentage-point decline from 18 to 17 percent in five years is itself a serious problem. It translates to a forgone revenue of Sh. 77 billion in FY16/17 (see chart below). If we assume that the 15.4 figure is an underestimate and instead apply a revenue yield of 17 percent last year, the revenue yield gap drops to a more plausible Sh. 80 billion. Why?

Revenue to GDP ratio, % (LHS) and implied revenue gap Sh. billion (RHS)

Revenue to GDP ratio, % (LHS) and implied revenue gap Sh. billion (RHS)

First, a lot of the borrowed money was stolen outright and many, perhaps all the projects have been done at highly inflated costs. We still do not have any physical evidence of what we spent the proceeds of the first eurobond, Sh.190 billion (US$ 2.2 billion) proceeds of the first eurobond issue on. Government claims that the money was channeled into the development budget and absorbed in one financial year. Not only is it simply not possible to build things at that rate, the funding for all the projects done for that year is accounted for without the eurobond money. This is the reason that the special audit of the eurobond has never come out.

A lot of the borrowed money was stolen outright and many, perhaps all, of the projects have been done at highly inflated costs. We still do not have any physical evidence of what we spent the proceeds of the first Eurobond on…

The national investment rate has remained stagnant at about 18 percent of GDP, against a requirement of 25-30 percent of GDP. We also know that credit to the private sector collapsed suddenly three years ago, and has been comatose since. The credit market has become a pyramid scheme, where interest on government securities is re-invested in government securities. As with all pyramid schemes, this one too will come to grief.

In short, the reason why the revenue yield has declined is because the productive base of the economy has not expanded. The Jubilee administration bet the farm on a state of the art milking machine, even built a brand new shed to go with it, and now expects the cows to produce more milk. It is the same cows. And now the debt repayments and electricity bills are eating into the working capital forcing the farmer to cut back on feed. They now lament that the milkman (KRA) has a new machine but is still unable to produce more milk.

But the National Treasury’s growth projections are as panglossian as ever. In the original budget forecast, the nominal GDP expands from 7.7 trillion in FY16/17 (the latest actual data) to Sh. 12.6 trillion in FY20/21 a growth of 64 percent or 17 percent per year. Nominal GDP is the denominator used to calculate budget financial ratios. This translates to a real economic growth rate of 7.4 percent per year (this is obtained by applying an inflation adjustment known as GDP deflator. I have applied the average deflator for the last five years). Average growth rate for the last five years—5.56 percent. Growth has topped seven percent only once in the last thirty years— 2007. Now comes the remarkable part. In the revised projections, nominal GDP has been adjusted upwards to just under Sh. 13 trillion in FY20/21. It is conceivable that the mandarins are factoring higher inflation— one hopes so because otherwise it translates to a delusional eight percent per year growth rate. The reason for the sharp fall in the revenue ratio last year is now clear— GDP has been inflated on purpose.

What is this fantasy in aid of? Their purpose is to reduce the budget financial ratios without budget cuts. This way, they are able to “get away” with fiddling with the actual budget figures and still achieve “fiscal consolidation.” This year, the deficit in the revised budget is adjusted upwards by 14b from 603 to 622 billion but it as a ratio to GDP it declines from 6.3 to 6.1 percent on account of GDP being adjusted upwards by 321 billion. In FY21/22 the nominal GDP projection is jerked up 17 percent which excluding an inflation surge, brings the real growth rate for the period to 8.4 percent. This enables the mandarin to “bring down” the budget deficit 3.4 percent, even as expenditure grows by Sh.750 billion. A serious sensible projection would have projected 5 percent real growth. A 3.4 percent of GDP deficit based on this would have required expenditure to be adjusted downwards by Sh. 400 billion, or revenue to rise by similar amount or a combination of the two.

The budget, both the original and supplementary one, is best summed as “do nothing” strategy. If you are not up to changing reality, change the numbers.

We are compelled to wonder who this tomfoolery is meant for? It is not the public, they don’t get to see these numbers, let alone read and understand them. It cannot possibly be the IMF, the credit rating agencies or the markets. If anything, this is nothing short of showing the markets a middle finger. That to my mind, leaves only one constituency— their political bosses. The mandarins are telling them what they, the political bosses, want to hear.

My first column calling out the Jubilee’s administration fiscal recklessness, published in August 2014 was subtitled “Lessons from Ghana”.

Three days ago, the Ghanaian government announced that it was planning to issue $50 billion “century bonds” over the next few years, starting with a five to ten billion issue by the end of the year. A “century bond” is a bond with a hundred year maturity. Only three developing countries—China, Mexico and Argentina_ have sold century bonds. Ghana’s issue will be the biggest. A 10 billion dollar issue is a fifth of Ghana’s GDP and would cost a billion dollars in interest a year. The markets did not like the news. Immediately, the yields on Ghana’s eurobond yields shot up (which is another way of saying the value of its bonds fell) and the Cedi fell 2.6 percent. The Financial Times summed it up thus: “In capital market terms, this is no this is not just a moon shot, it’s a mission to Mars.” The FT story was headlined, “Someone tell Ghana this it isn’t 2017 anymore.”

If you are not up to changing reality, change the numbers. We are compelled to wonder who this tomfoolery is meant for? It is not the public, they don’t get to see these numbers, let alone read and understand them. It cannot possibly be the IMF, the credit rating agencies or the markets. If anything, this is nothing short of showing the markets the middle finger. That to my mind, leaves only one constituency— their political bosses. The mandarins are telling them what they, the political bosses, want to hear.

Argentina issued its century bond last May. The issue was oversubscribed four times. A year down the road, Argentina is in the grip of another financial meltdown. Inflation is raging at 3.5 percent a month, the Central Bank has raised the benchmark interest rate to 60 percent and the Peso, down 52 percent on the dollar this year, is still falling. What changed? In 2015 Argentina elected a new president who promised to impose macroeconomic discipline. Argentina’s legendary fiscal laxity has led to eight debt defaults, including the biggest sovereign default in history in 2002. The markets took the new president seriously. Earlier this year, he showed signs of backtracking — revising inflation target upwards and lowering interest rates. Market sentiment turned. Argentina had plenty of foreign exchange reserves, but within weeks it was looking for lifelines everywhere including its perpetual nemesis the IMF which it has approached for a US$ 50 billion bailout.

Someone needs to tell Jubilee this isn’t 2017 anymore.

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David Ndii

David Ndii is one of Kenya's leading economists and public intellectuals.

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Saving Lamu: How a Campaign for Environmental Justice Was Fought

The campaign against a coal-fired plant in Lamu is a good example of how a small, voiceless community can be mobilised to fight powerful and influential forces intent on destroying the environment. RASNA WARAH explores key aspects of the campaign and the landmark ruling that has inspired environmentalists and social justice advocates worldwide.

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In a country where justice is often denied, delayed or distorted, the landmark ruling of the National Environment Tribunal (NET) to cancel the licence for a proposed electricity-generating coal-fired plant in Lamu has restored many Kenyans’ faith in state institutions. The significance of the ruling, which was a victory for environmental justice advocates at home and abroad, cannot be underestimated (though going by the local media coverage of the judgement, it might appear that nothing remarkable has happened).

For the people of Lamu, who will be the most negatively affected if the plant is built, the decision was nothing short of a miracle, especially given that this is a country where major infrastructure projects are often carried out at the expense of local communities and the environment – and where such projects often involve kickbacks and corruption at the highest levels of government. Ochiel Dudley, a lawyer with Katiba Institute, which litigated the precedent-setting case, said that the ruling was a major victory for the people of Lamu and Kenya. “It has stamped the authority of tribunals in courts to ensure compliance with the rule of law,” he stated shortly after the ruling on 26 June.

In a country where justice is often denied, delayed or distorted, the landmark ruling of the National Environment Tribunal (NET) to cancel the licence for a proposed electricity-generating coal-fired plant in Lamu has restored many Kenyans’ faith in state institutions

NET was established under Section 125 of the Environment Management and Coordination Act (1999). Its mandate is to hear disputes arising from decisions of the National Environment Management Authority (NEMA) on the issuance, denial or revocation of licences. In its 26 June 2019 judgement, NET ordered Amu Power, the key player in the proposed Lamu project, to halt construction of the plant and to undertake a fresh environmental and social impact assessment (ESIA) for the project. It noted that the ESIA carried out for Amu Power by a company called Kurrent Technologies was flawed in one key aspect: it did not involve public participation, a constitutional requirement that NET chairman Mohamed Balala described as “the oxygen that gives life to an ESIA report”. In its ruling, NET stated that the lack of public participation was “contemptuous of the people of Lamu”.

Other important points in the ruling included the project’s lack of a strategic environmental assessment and insufficient and unclear plans for toxic coal ash handling and storage, as well as the project’s failure to take into consideration Kenya’s Climate Change Act.

The wrong choice for Kenya

There were many environmental, social and health concerns raised by those against the construction of the coal-fired plant. Environmentalists pointed out that the burning of coal releases toxic particles into the air that can cause asthma, bronchitis, cardiovascular disease and cancer. These particles can also affect fish, crops and wildlife.

In addition, burning coal requires millions of gallons of water to keep the plant cool. Releasing this water into the ocean around Lamu would increase the temperature of the water and kill the fish and other marine life. It would also impact the livelihoods of fishermen in the area.

There are also cultural concerns. Lamu Town has been designated a World Heritage site by the United Nations, which means that the Kenyan government is obligated to protect and preserve it. The proposed plant’s location on 865 acres of land in Kwasasi, just 20 kilometres from this historical town, is especially worrisome. Lamu Town is world-renowned for being one of oldest settlements along the East African coast, and is a much-loved tourist destination. Its pristine beaches have attracted the rich and famous and its Swahili culture has been the subject of countless studies. The toxic particles emitted from the plant could corrode the centuries-old buildings in the town and increase air pollution levels, which will make this unique island town an unhealthy environment for the residents and a less attractive destination for tourists.

The government insists that the economic benefits of the plant outweigh any environmental concerns. It says that the plant will bring much-needed development to the area. Critics argue that if the national and county governments were really keen on improving the living standards of the people of Lamu, they might have built more essential infrastructure, such as sewerage and sanitation systems, which are woefully inadequate, or a first-class hospital, which is much needed in this neglected part of the country.

Proponents of the project say that the plant will significantly reduce the cost of electricity. Those advocating against the plant disagree. They say that the 1,050-megawatt plant will actually cause the price of electricity to increase because the price of electricity will be directly related to the price of coal, which fluctuates. Moreover, the cost of building transmission lines to get the electricity to people in Nairobi and elsewhere and a train to get coal from Kitui will increase the cost of the electricity generated. And if the original intention was to export surplus electricity generated in Kenya to neighbouring countries, that plan is no longer viable: Ethiopia is currently quadrupling its energy-generating capacity and Tanzania is doubling it.

There were many environmental, social and health concerns raised by those against the construction of the coal-fired plant. Environmentalists pointed out that the burning of coal releases toxic particles into the air that can cause asthma, bronchitis, cardiovascular disease and cancer. These particles can also affect fish, crops and wildlife.

David Schlissel from the Institute for Energy Economics and Financial Analysis (IEEFA), in an assessment he conducted on the project, says that the Lamu coal plant is “the wrong choice for Kenya” for several reasons. First, Amu Power, the single-purpose joint venture between Gulf Energy and Centum Investment, calculated the price of electricity on the following erroneous assumptions: i) that coal would cost $50 per metric tonne (in 2017 the price of coal was $85 per tonne); ii) that Kenya’s demand for electricity would go up by 13 per cent annually (demand has actually grown by only 6 per cent a year, partly due to the slowing down of the economy); iii) that the plant would be utilised at 85 per cent capacity (if built, the plant will be grossly underutilised, running at a capacity of between 5 and 34 per cent and producing far less electricity than Amu claims it wil); and iv) that electricity would cost $0.072 per kilowatt hour (IEEFA calculated that electricity from the plant would cost three to ten times as much, from between $0.22 and $0.75 per kilowatt hour).

The most shocking part of the deal is that Kenyans will have to pay about $360 million per year in capacity charges (that’s over $1 million per day!) whether or not the plant generates any electricity and even if it is not operational. This makes one wonder how the government entered into the deal with Amu Power and whether any legal advice was sought before the agreement was signed. It also raises the question of whether people in government knew about the non-viability of the project beforehand but proceeded to go ahead with the project because there was $1 million to be made per day without any sweat or investment.

How this project was allowed in a world where countries including China (the biggest emitter of greenhouse gases and whose citizens are paying for this with their health) are weaning themselves away from coal is also disturbing, given that in 2018 President Uhuru Kenyatta pledged to move Kenya to 100 per cent renewable energy by 2020. But then in Kenya, it is not reason, common sense or environmental and social justice considerations that determine public policy but individual greed, myopic self-interest and lack of a long-term vision for the country and its future.

How it all started

In September 2013, five months after Uhuru Kenyatta was sworn in as president, the Kenyan government invited bids for the Lamu coal-fired plant. Twenty-six submissions were received. Gulf Energy was awarded the tender.

Amu Power, which did not even exist as an entity when the invitation for the bids went out, was only established after Gulf Energy, the developer and co-sponsor of the plant, started a joint venture with Centum, a Kenyan-owned investment company whose major shareholder is the Kenyan magnate Chris Kirubi and whose CEO is James Mworia. (Though there is suspicion that Amu Power is a front for powerful or influential people who wish to remain unknown.) The main potential funder of this $2 billion project is the Industrial and Commercial Bank of China. The African Development Bank initially showed interest in partially funding the project but pulled out after campaigners opposed the project. The Bank’s president stated that it was the lending institution’s policy not to fund coal projects.

The campaign against the project started in earnest in October 2016 when two civil society organisations – Save Lamu and Natural Justice – lodged an objection with the Energy Regulatory Commission (ERC) to Amu Power’s application for a coal plant in Lamu. This was the beginning of a successful campaign that culminated in the NET ruling last month.

So how did the people and organisations who campaigned against the construction of the coal-fired plant in Lamu succeed in their efforts? Well, two things stand out which other environmental campaigners might want to take note of as they provide a good case study on how to obtain environmental justice in the face of stiff opposition from government and corporate interests.

One, the campaign was fought not just by the affected communities in Lamu but by a coalition of local and foreign environmental and human rights organisations, namely, Save Lamu, Heinrich-Böll-Stiftung, 350 Africa, Centre for Human Rights and Civic Education, Sauti Ya Wanjiku, Muhuri – Muslims for Human Rights, National Resources Alliance of Kenya, American Jewish World Service and the Center for Justice Governance and Environmental Action. This coalition provided the campaign with the legal and financial resources and the moral strength and support that would not have been available if the campaign had been led only by members of the affected community in Lamu – though it is important to note that the residents of Lamu were both vocal and visible throughout the campaign.

Two, these organisations and their supporters designed a highly successful media campaign under the banner deCOALonize.org, which published regular updates online and on social media and organised street demonstrations both in Lamu and in Nairobi. By the time the case went to NET, opposition was so strong that a ruling in support of the plant in Lamu would have appeared to be totally misguided, or worse, highly compromised. Public pressure was thus key to the success of the campaign.

Organisers of the campaign say that the battle is not yet over. A spokesperson for the campaign said that while last month’s NET ruling will delay the Lamu coal project, there is no guarantee that the project will be halted indefinitely. “Amu Power can conduct a fresh environmental and social impact assessment and apply for a new licence, or can choose to appeal the decision, seeking to overturn the ruling and have the licence restored,” he said.

Amu Power has until 26 July to file a notice of appeal. However, the deCOALonize campaigners believe that Amu is not likely to appeal the ruling because it wouldn’t want to stall the project any longer with a court case it might very well lose. They believe that Amu will most probably go for a fresh ESIA that will deal with the issues raised by the tribunal. If a licence to build the plant is then granted, the struggle to save Lamu will continue.

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Limuru III: SabaSaba@29 – A Call to Action

Our elites should never be politically underestimated as they have a genius for lies, distractions, diversions, and divisions. They have mastered the art of manipulating the divisions of class, clan, gender, generation, religion, region, occupation, race, and, recently, even the English Premier League. Politics of division must be replaced by politics of humanity, national unity, and inclusion. Above all, we must breathe life into our constitution and our vision of how our politics is to be organised.

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Limuru III: SabaSaba@29 - A Call to Action
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Those of you who read Mutemi wa Kiama’s The Real Lords of Kenyan Poverty in his articulate response to the Deputy President will have captured this truth: our burning political issue is our ruling class/elites, the root cause of poverty, corruption, theft of national resources, inequalities and odious debts. They are the authors of our divisions and our strife, and the agents of foreign interests in our motherland. Yes, this class must be replaced by its antithesis, an alternative patriotic political leadership. Governor Kibutha Kibwana has advised us thus: “The social reform movement needs to reimagine itself from the grassroots.” This is also advice for the alternative political leadership that is anchored to such a movement. The communities at the grassroots must organise themselves and we must facilitate such organisations on the basis that we also are educated by communities.

The ruling class is racketeering, unpatriotic, kleptocratic, and is also the running dogs of the imperialism of the West and the East. This class has been called wala watu, walalahai, ogas, mazimwi, mapebari, mashetani. In Kiikamba we call this class asumbi kitundumo, and the Kalenjin call them chemosi. The Kikuyu call this class uthamaki. David Ndii refers to them as “some animals [who] are more equal than others.” Alamin Kimathi has called them mabwenyenye. Each community in Kenya should have a name for this class. They hate us, the people they lead and mislead. They wish us dead when they do not kill us. How do you explain the illicit economy in our midst (counterfeits, wildlife crimes, human trafficking, trafficking in body parts, drug trafficking, piracy, terrorism, money laundering) that makes us sick and kills us? Even the so-called licit economy is mired in illegal financial flows by multinationals; exploitation, domination, and oppression by foreign interests enslaves our people.

The communities at the grassroots must organise themselves and we must facilitate such organisations on the basis that we also are educated by communities.

Which idiot said the British had left? Or the Europeans? Or the Americans? And now the Chinese are here. With a multi-racial, multi-ethnic elite owning most of the land and other national resources, do we own our motherland? With the skyrocketing national debt, is it not a matter of time before our patriotic youth do what the Mau Mau Land and Freedom Army did in the 1940s and 1950s; organise and fight to free our motherland from foreign occupiers and their national agents?

A recent Oxfam Report states that, in a population estimated at 51 million, 8,300 Kenyan billionaires and multi-millionaires own assets equal to those of the rest of us. This inequality can only be explained by the elites’ politics of division for the last 56 years. Our elites should never be politically underestimated as they have a genius for lies, distractions, diversions, and divisions. They have mastered the art of manipulating the divisions of class, clan, gender, generation, religion, region, occupation, race, and, recently, even the English Premier League. Politics of division must be replaced by politics of humanity, national unity, and inclusion. Above all, we must breathe life into our constitution and our vision of how our politics is to be organised.

The ruling class is racketeering, unpatriotic, kleptocratic, and is also the running dogs of the imperialism of the West and the East. This class has been called wala watu, walalahai, ogas, mazimwi, mapebari, mashetani. In Kiikamba we call this class asumbi kitundumo, and the Kalenjin call them chemosi. The Kikuyu call this class uthamaki. David Ndii refers to them as “some animals [who] are more equal than others.” Alamin Kimathi has called them mabwenyenye. Each community in Kenya should have a name for this class.

The long march to an alternative political leadership started with Me Kitilili and was joined by other patriots, leading to the Mau Mau war of independence. The march has never stopped; it may occasionally retreat but like the mole that keeps on digging underground, periodic progressive eruptions of this march have marked the course of our history. So, today we meet on this site, a site that has been part of this long march to freedom, emancipation, and the reclaiming of our land and national resources. Limuru is the home of the 2010 constitution. It is to this constitutional shrine that we return to assert its validity, condemn its betrayal, and organise for its protection and robust implementation. The constitution is an excellent framework for getting Kenya out of its governance and developmental mess. It only requires agency, an alternative political leadership and the support of all Kenyans.

Limuru has witnessed previous alliances between civil society and opposition political parties. These parties were not an authentic opposition in the country but part of the intra-elite struggles for political power. The NCEC [National Convention Executive Council] learned its lesson from the IPPG [Inter-Parties Parliamentary Group]. We cannot continue to view these baronial and elite factions as providing a political alternative. There is none among them that is the lesser evil. We are in Limuru to end opportunistic political strategies with the ruling elite that have been devoid of a proper class analysis. We cannot continue to be the transformative lambs reclining comfortably with the baronial lions. We cannot run with the hare and hunt with the hounds. It is time we had an authentic opposition that can contest for power after 56 years of a baronial rule that has promised to build bridges to get us to Canaan only to return us to Egypt.

Kenya gave birth to a beautiful baby, the 2010 constitution. We then proceeded to hand over the baby to a child-trafficking class to take care of it. We now know what a grievous mistake we have made. We must reclaim this baby and entrust it to an alternative political leadership to avoid it being killed and its body parts being trafficked.

A recent Oxfam Report states that, in a population estimated at 51 million, 8,300 Kenyan billionaires and multi-millionaires own assets equal to those of the rest of us. This inequality can only be explained by the elites’ politics of division for the last 56 years

We want the implementation of the constitution, not the further weakening of its structure through defective and self-serving amendments that will only entrench bad behaviour. Tinkering with the constitution is an attempt at create a bypass to misrule, misgovernance, and authoritarianism. Such amendments will result in Kenya sinking deeper into a political and economic morass.

So, in this journey of a thousand miles, we are starting the last lap and taking the last step, driven by the revolutionary spirits of our ancestors and our God of freedom, equality, equity, emancipation, inclusiveness, non-discrimination, integrity, accountability, peace, national unity and prosperity.

So then, what must be done?

We have with us social movements and political parties: Muungano, Ukweli, and the Communist Party of Kenya. We also have experts and intellectuals. Let each of these groups choose a man and a woman to constitute the Interim Leadership of the Peoples’ Popular Initiative Convention (PPIC) to address this issue of alternative political leadership. Let us ensure that a multi-racial, multi-ethnic, multi-gendered, and multi-religious face of Kenya is represented as we expand this Interim Leadership and choose a collective leadership of the first among equals. Let various Committees be formed to work on narratives that run counter to those of the elites, with the sole aim of contesting for political power. A fundamental committee will be the Finance Committee because, indeed, we must raise our funds from among the Kenyan people as happened during the struggle for independence.

Without capturing state power our resources will not be safe, and our national debt will never be paid, resulting in our enslavement. We announce here that we will never pay debts that were illegally contracted or stolen. On the contrary, we will help the creditors recover their debts from those who are liable to pay them. After all, the bulk of the assets of these people are in the countries of the creditor nations, institutions, and individuals; the math will be really easy.

The Interim Leadership should ensure we work on basic papers – with the group reports here forming the background of such papers – to enable the PPIC to come up with a broad manifesto that Limuru IV will ratify before the end of the year.

Let us get down to work.

Thank you.

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Memo to Uhuru Kenyatta: Finish up and Go

With nothing but political blunders and policy failures behind him, there is only one thing left that Uhuru Kenyatta can do for Kenya, and that is this. Mr Uhuru Kenyatta, please do us and yourself a big favour; you have neither the mandate nor the wherewithal to shape our political destiny. Just finish up and go.

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Memo to Uhuru Kenyatta: Finish up and Go
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December 30 ought to be a memorable day on Kenya’s political calendar. On this day in 2002, Mwai Kibaki took office as the first democratically elected President of Kenya. When it is remembered, though, it is not for the inauguration of Kibaki, but for Moi’s humiliation. The only account we have of the chaotic event is that of Lee Njiru, Moi’s communications chief. According to Njiru, as soon as Uhuru Kenyatta conceded defeat on the afternoon of the 29th, the Kibaki people insisted on an immediate handover. The inauguration was scheduled for the following day without any consultations. At 3 p.m. on that day, Moi got tired of waiting and decided to go down to Uhuru park to get it over and done with. This is how he ended up in the chaotic situation, being jeered at and pelted with mud, bottles and whatever else people could lay their hands on. Kibaki’s description of Moi’s tenure as “years of misrule and ineptitude” did not suggest that there was any intention to treat Moi kindly.

Shortly after assuming power, the NARC administration replaced Moi’s face on the currency with Jomo Kenyatta’s. It was ill-advised. By then, the NARC dream had dissolved into a toxic nightmare. The Kibaki men — later to emerge as the Anglo-Leasing cabal — had walked out of Bomas and gone off to write the Wako/Kilifi draft constitution. Seen through the prism of the NARC fallout, this was not just further humiliation of Moi; it symbolised the resurgence of Kikuyu restorationism — the thing Kikuyu supremacists metaphorise as gūcookia rūūī mūkaro, literally, returning the river to its course, meaning the return of power to where it belongs. For some reason, the Kibaki men seemed to have conflated Moi’s humiliation with the redemption of Jomo Kenyatta. They were mistaken. The rejection of Uhuru Kenyatta in the presidential bid in Central Kenya was, in part, antipathy towards his father’s rule which had already cost him the Gatundu parliamentary seat in 1997. Kaī tūgūthīnjīra hiti keerī? (are we to slaughter our goat for hyenas a second time?), people would ask.

A decade later the humiliation was invoked in conversations that would have seemed completely unrelated — the constitutional debate on the features Kenyan currency should have. It is these sentiments that informed the constitutional provision that outlaws portraits of individuals on the currency. So there was considerable disquiet in many quarters recently when new notes revealed a disingenuous way of keeping Kenyatta’s image on the currency — his statue prominently in the foreground of the Kenyatta International Conference Centre. There are many arresting images of the KICC that do not feature the statue. The State will no doubt seek, and may find defense in legal interpretation, but it is not lost on anyone that the intention is to defeat the spirit of the Constitution. The timing is awful.

I was at a social gathering in Kiambu recently where the dismay and disillusionment with Uhuru Kenyatta hovered over the otherwise succulent goat ribs and aged single malts like the smell of stale beer. The question was raised as to how the gathering would like their sentiments conveyed to Kenyatta. The “session chairman” distilled the sentiments aired into a four-point message: Andū mena thīna mūno (the people are suffering a lot); Ee toro ta Njoramu (he slumbers like the biblical Joram); Nītūmenyete nī mūkoroku ta ithe (we have learned he is as greedy as his father); Nī gūtee (we wasted our votes).

Seemingly unaware of these undercurrents in his backyard, or perhaps all too aware of them, Kenyatta recently appeared at a public gathering where — forgetting that he is the president of all Kenyans — he unleashed a diatribe in Kikuyu, repeatedly addressing the gathering as “andū aitū” (“our people”), and assuring them that he was on top of things. I gather that the outburst was triggered by his deputy arriving at the meeting fashionably late. We witnessed the same thing happen at Kenneth Matiba’s funeral service in Murang’a when Kenyatta came out guns blazing. But his outburst at the Akorino event is of far greater significance.

I was at a social gathering in Kiambu recently where the dismay and disillusionment with Uhuru Kenyatta hovered over the otherwise succulent goat ribs and aged single malts like the smell of stale beer.

The Uhuru-Ruto political pact was sold to the Kikuyu as a peace treaty that would shield the Kikuyu diaspora in the Rift Valley from politically motivated violence — a homegrown solution for which the Kikuyu sacrificed justice for the victims of the 2007/8 post-election violence. The Akorino community has a large presence in the Rift Valley epicenters of political violence. With their distinctive white turbans, this insular, exclusively Kikuyu sect, is a vulnerable, easy target. During Ruto’s trial at the International Criminal Court, evidence was adduced that the Akorino were specifically targeted using the euphemism “plucking mushrooms.” Ruto was personally implicated in the incitement and his defiant arrival at the Akorino meeting would have been unsettling for both Kenyatta and the Akorino — it was as if he had showed up to remind them that they have a deal, and that choices have consequences. Kenyatta, who is not given to introspection or self-restraint, let rip.

The Kenyatta-Ruto succession is the third chapter in the Kikuyu-Kalenjin land-for-power pact which began with the co-option of KADU into the Government, bringing Moi into the centre of power at the expense of Oginga Odinga. In 1967 Moi was elevated to the vice-presidency at the expense of more capable leaders — notably Tom Mboya. Prof. Anyang Nyong’o recalls asking Lee Kwan Yew for his thoughts on how Singapore’s and Kenya’s development trajectories diverged, to which Lee Kwan Yew quipped that we had killed Mboya. The deal with Moi facilitated the migration of the Kikuyu peasantry into the Rift Valley, which in turn enabled Kenyatta and other wealthy Kikuyu notables to acquire for themselves the migrants’ more valuable ancestral lands in central Kenya.

The Uhuru-Ruto political pact was sold to the Kikuyu as a peace treaty that would shield the Kikuyu diaspora in the Rift Valley from politically motivated violence — a homegrown solution for which the Kikuyu sacrificed justice for the victims of the 2007/8 post-election violence

Then came the Kenyatta succession intrigues that can be said to have begun with Mboya’s assassination and the Gatundu oathing ceremonies that sought to ensure that “biki biki itigakīra Chania (the motorcycle outriders will never cross the Chania River, meaning that power would remain in Kiambu). The machinations ranged from an attempt at constitutional change to preclude the Vice President from assuming power in the event of the president’s death (that elicited Charles Njonjo’s decree purporting to criminalise imagining the death of the president) to the more sinister Ngoroko affair, a hit squad embedded in the anti-stock theft police unit suspected to have been meant to assassinate or otherwise incapacitate Moi when Kenyatta died. The scheme was predicated on Kenyatta dying in Nakuru, his favourite retreat, in which case the schemers would have been the first to know. But Kenyatta died at the Coast.

It is now clear that, for whatever reason, Kenyatta and the interest groups he represents have decided that it is not in their interest that he be succeeded by William Ruto. What is unclear is whether there is a Plan B because Plan A, a corruption takedown, is not working. There is only one way to make it work and that is to convict Ruto for corruption. But such is the obsession with neutralising him that they just could not resist the opportunity to weaponise the change of currency notes for a financial takedown. It is believed that a sizeable chunk of William Ruto’s seemingly inexhaustible political war chest is hoarded in cash that he may not be able to convert to the new currency, in effect rendering the stash valueless.

Prof. Anyang Nyong’o recalls asking Lee Kwan Yew for his thoughts on how Singapore’s and Kenya’s development trajectories diverged, to which Lee Kwan Yew quipped that we had killed Mboya

Article 262 (34) of the Constitution — the transitional provision relating to the currency change — states that “Nothing in Article 231 (4) affects the validity of coins and notes issued before the effective date.” Conflating the currency change mandated by the Constitution with this purported war on money laundering has left Ruto’s takedown hostage to the interpretation of this provision by the courts. But even the presumption that repudiating the cash hoards will cripple Ruto financially, and that crippling him financially will neutralise him politically, is wishful thinking. Uhuru Kenyatta’s anti-Ruto schemes are evidently as hare-brained as his father’s acolytes’ ill-fated anti-Moi schemes. And like Moi before him, the longer he survives this onslaught, and the more Uhuru Kenyatta reverts to type — ethnic chauvinism, contempt, dynastic privilege and arrogance of power — the stronger Ruto becomes.

The Kenyatta-Ruto succession is the third chapter in the Kikuyu-Kalenjin land-for-power pact which began with the co-option of KADU into the Government, bringing Moi into the centre of power at the expense of Oginga Odinga. In 1967 Moi was elevated to the vice-presidency at the expense of more capable leaders — notably Tom Mboya

In their “handshake” memorandum, titled “Building Bridges to a New Kenyan Nation,” Uhuru Kenyatta and Raila Odinga promised to lead the nation in correcting the sins of their fathers:

We are grateful for our fathers, we stand on their shoulders. Yet we can also see that the promise of our nation has not been met as fully as it should have been; we know there are different measures our founding fathers should have taken as they forged this young nation. H.E. President Uhuru Kenyatta and H.E. Raila Odinga are the two leaders who symbolise the many ways in which the country has gone full circle in its divisions. Intent on not witnessing the country suffer similar future cycles of the same tribulations it has since 1963, they are determined to offer the leadership that prevents future generations inheriting dangerous divisions and offer them a path to a bright future for all.

We have seen none of this. What we see instead is the same shameless politics of self-preservation, cynical ethnic mobilisation, arrogance of power and that quintessential Kenyatta disease — greed.

It has recently emerged that Uhuru Kenyatta is exerting pressure on the government to prioritise the upgrading of the Nairobi Eastern by-pass specifically to benefit the Northlands satellite city project on one of the family’s expansive, dubiously acquired, land holdings. Last week, the official State House twitter handle @StateHouseKenya was promoting Stawi, the lending platform fronted by the Commercial Bank of Africa, the Kenyatta family bank featured in this column some weeks ago. The Central Bank Governor — who is now doubling up as CBA’s chief marketing officer — lied to the public that Stawi will provide cheap credit to small businesses at an interest rate of 9 per cent per year, while in truth, the cost of the loans as measured by the annual percentage rate (APR) averages 35 per cent, and is no different from other digital lenders in the market. Corruption could not be more egregious.

In their “handshake” memorandum, titled “Building Bridges to a New Kenyan Nation,” Uhuru Kenyatta and Raila Odinga promised to lead the nation in correcting the sins of their fathers

Yet some Kenyans continue to cling to the hope that he is fighting corruption. Uhuru is not fighting corruption. He is fighting Ruto. And he no longer bothers to hide the fact that he is using state power, his office and public resources to further his private business interests. Much of what we are seeing from him suggests that he may be under the impression that the “Kenya” in Kenyatta is proprietary. One of the sins of the fathers is the personality cult that Uhuru Kenyatta is hell-bent on perpetuating by retaining his father’s image on our currency, against the letter and spirit of the constitution he has sworn to defend. But all is not lost. By showing us the middle finger, Uhuru Kenyatta has ensured that there will come a time to do unto Kenyatta what was done to Moi. And when the music starts, it will not stop at the currency — streets, airports and universities will be fair game.

Having floundered on providing the promised leadership — no surprises there — the handshake is now clinging onto the hope of constitutional amendments to either exclude or neutralise Ruto, a scheme reminiscent of the 1966 Limuru KANU Conference constitutional amendments that replaced the deputy party leader’s position with eight regional vice presidents, in effect ending Oginga Odinga’s chances of succeeding Kenyatta. This constitutional amendment scheme is now a poisoned chalice. We say in Gikuyu, mbūri igūthinjwo ndionagio kahiū (one does not approach a goat for slaughter with the knife in full view).

We have seen none of this. What we see instead is the same shameless politics of self-preservation, cynical ethnic mobilisation, arrogance of power and that quintessential Kenyatta disease — greed.

I have stated many times, and I will restate here again that the leadership that Uhuru and Raila promised behoves them to play the role of honest statesmen who would midwife political reforms leading up to a free and fair election, followed by retirement for both of them. But they have eschewed statesmanship for skulduggery and political intrigue, lending credence to suspicions that the handshake is nothing more than a Kenyatta self-preservation scheme to which Raila Odinga has been enticed with a share of the spoils and a reinstatement of the Odinga clan to the pantheon of Kenya’s ruling dynasties. It is time to end this nonsense.

With nothing but political blunders and policy failures behind him, there is only one thing left that Uhuru Kenyatta can do for Kenya, and that is this:

Mr Uhuru Kenyatta please do us and yourself a big favour; you have neither the mandate nor the wherewithal to shape our political destiny. Just finish up and go.

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