The political side of President Moi‘s reign has overshadowed his economic side. Let’s try and dissect Moinomics, the economics during his reign with a scholarly knife. Moi ran the country under a constitution that gave him immense powers. We can add he did not hesitate to use that power.
His detractors underestimated him but when he got power, it was a different game. Some of his political students do not seem to have learnt this simple lesson; in politics you play the long game.
Back to Moinomics. His rule straddles two economic systems, the command economy and the free markets. Up to around 1993, the prices of most commodities were controlled; we all can recall the new prices of essentials and not so essential commodities or items from sugar to cigarettes and beer was the highlight of budget speeches.
Under pressure from the International Monetary Fund (IMF) and other multilateral organisations resulting from Washington consensus that called for free markets, the Kenyan economic space was finally liberalised. The invisible hand of the market replaced the visible hand of the government.
This took hoi polloi by surprise. Prices hit the roof, services that were free like medical services had to be paid for. The promised social safety net never came. Those old enough recall the economic turmoil of the early 1990s.
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As they say fortune favours the prepared, men and women ready for a liberalised economy made hay when the sun shone. Those well placed could get state assets at a throw away price. Access to information became an asset, what was to be sold and at what price was not always publicly available.
The Kenyan economy mirrors Russia to a large extent around the same period. Contrast that with China which seems to have liberalised the economy but not politics. Just like in Russia, a few oligarchs emerged in Kenya. Can you list a few?
In Moi’s reign, economic liberalisation went hand in hand with political liberalisation. Remember prelude to multipartism? Give credit where it’s due, handling a country going through both political and economic liberalisation was not easy, not just for President Moi but for anyone who could have been the president.
The withholding of foreign aid did not make matters any better in the 90s.
The low growth in the 90s was a result of hangover from single party and command economy coupled with uncertainty after liberalisation. The transformation after liberalisation takes place with a lag. By the time Mwai Kibaki took over, the chaos of liberalisation had worked themselves out and growth picked.
It will remain a conjecture how someone else could have successfully handled the two liberalisations without the power of the old constitution. Suppose liberalisation, both political and economic happened under the current constitution?
During Jomo Kenyatta and Moi eras, Kenya’s economic space was defended by laws, regulations and patriotism fired by memories of Mau Mau and colonialism.
With Kibaki, and his dalliance with the East, read China, Kenya’s economy got new economic players. In every sector, the visible hand of the government got a competitor, from the invisible hand of the market with appendages beyond the borders.
The internationalisation of the Kenyan market has accelerated under the Uhuru, read Jubilee regime. I am not an economic nationalist like Donald Trump, but I can’t fail to notice the trend.
Education sector is attracting lots of investors beyond the traditional international schools. Remember Makini School being bought? Noted the number of universities looking for Kenyan students?
Carrefour is now in Kenya, Uchumi is closed. Did anyone notice as BBI rallies were going on a French firm was buying 30 percent of Naivas? South Africans have made inroads into our insurance sector, while American fast foods, hotels and cars have made inroads into the Kenyan market. Chinese have gone beyond the SGR with their electronics. We can’t forget Nigerians and their banks and churches. You can add to the list.
For hundreds of years, Kenya has been a dream destination to foreigners beyond the big Safari. They include the Portuguese, the Arabs, the Persians, the Chinese (they came before Portuguese), Germans attempted and finally Britons who ruled us for 68 years. We could add the Bantus. That dream now got new adherents riding on an economic horse. Elspeth Huxley’s book, “The White man’s country” may still be relevant today, if read using economic lenses.
It’s an open question if Kenyans will be economic beneficiaries of the opening up of our markets. Some could argue that will shift Kenya to a higher indifference curve, to higher standards of living while transferring technology and new cultures. That is more for the middle class and upper echelons of the society. What of hoi polloi?
The Kenyan market is now free for all. It’s another question if a Kenyan Trump will one day say “Kenya first.”
It seems just as in politics, we shifted from one extreme to another in economics. From Moi’s single party to almost party less country, from command economy to too much economic liberalisation.
What few can dispute is that Moi’s long shadow will continue hanging over this nation long after his sojourn to the beautiful shore.
-The writer is an associate professor at the University of Nairobi.
