With robust economy, challenge is how to share national cake fairly

About two weeks ago, Kenya became a middle-income economy, leading to a hot debate on whether or not this will change the fortunes of this country.

There is every reason to celebrate the new status as the country’s economy is far bigger than previously thought – it has gone up by 25 per cent. Now we have a bigger cake, so to speak. However, the celebrations are tempered by the hard reality that the national cake is not distributed evenly among Kenyans. We have a small class of immensely wealthy Kenyans, while there is a disproportionately large number of poor people.

Now that we know the economy has been humming along quite fine, the biggest challenge then is to ensure all Kenyans get an equitable piece of the cake. The benefits of the growing economy must be enjoyed by all and sundry. This is not to say that being classified as a middle-income country means we have reached the promised land, impressive statistics nothwithstanding. We are still miles away from a place flowing with milk and honey.

It is worth noting that after the rebasing, our economy moved to ninth position in Africa, up from 12, surpassing Ghana, Tunisia and Ethiopia. Nigeria, South Africa, Egypt, Algeria, Angola, Morocco, Libya and Sudan still rank higher than Kenya. The Gross Domestic Product (GDP) – value of goods and services generated in the country – is now estimated at US$53.4 billion (Sh4.76 trillion) in 2013 after the rebasing, up from US$42.6 billion (Sh3.8 trillion).

Despite this, we need not belabour the fact that out work is cut out for us and must work extra hard to consolidate our new position. We must sustain a healthy growth, lest we slip back to our previous status.

A lot more needs to be done if we are to move to the next level. This will only be attained through the concerted efforts of leaders, workers, investors, institutions of higher learning, economists and development experts. Everyone with something to contribute needs to be on board.

The recalculation of the economic matrices certainly has crucial benefits in itself. Investors will be disabused of the notion that the economy is in the doldrums as early indices indicated, but is actually fairly thriving, underpinned by sound fundamentals. In such an environment, economic risks are reduced, which is music to investors’ ears. The country is also now able to borrow more for such capital-intensive development projects as infrastracture.

As a nation, our prospects have never looked more promising. Aside from our new status, we have an emerging oil and gas sector with the potential to be the game-changer in economic growth. When these invaluable natural resources finally get into the pipeline, the dynamics of the economic fundamentals will radically shift for the better. We will have a well-oiled economy.

Kenya has also embarked on an aggressive effort to put more electricity on the national grid. The Government targets to generate an additional 5,000 megawatts in three years. Some of the projects towards this end have already been completed. Consequently, the Ministry of Energy that power costs are set to fall by 12 per cent.

 For years, the high cost of electricity has been the bane of the manufacturing sector. This has made Kenya one of the most expensive places in which to do business. Our neighbours have been giving us a run for our money as far as direct foreign investment (DFI) is concerned. And this is mainly because of the sky-high power tariffs, although issues like red tape and insecurity have also played some role.

With Kenya’s future seemingly bright, it is imperative that we find a way to ensure all Kenyans benefit. This is where devolution can play a critical role. The devolved governments are at a vantage point to determine the most pressing issues facing the common man.

As agents of development, counties must ensure the benefits accruing from a robust economic growth reach the remotest parts of the country. This way, no one will be left behind by the train of development.

A critical sector that has been devolved is agriculture. Without doubt, this sector is a key plank of the country’s bid to improve the standards of living. The shortest route out of poverty and hunger is empowering the small farmer. It does not require massive resources to do this — many Kenyans have farms but lack the necessary expertise to transform them into thriving havens.

Besides stimulating agriculture, counties can do a lot more to ensure the national cake is equitably distributed. Essentially, counties have an indispensable role to play to ensure the benefits of the economy are felt at the grassroots. Conversely, county leaders have an important role in revitalising economic growth in their respective jurisdictions, thereby increasing overall GDP.