Perhaps keen to leave a lasting impression, President Uhuru Kenyatta has identified manufacturing, affordable housing, healthcare and food security as his areas of focus for the next five years.
Christened the ‘Big Four’, their outcomes include building 500,000 low cost houses, universal healthcare, a 10-fold exports increase, irrigation of 1.2 million acres of land, and millions of new jobs.
It all sounds good and ambitious. Mr Kenyatta must relish the feeling of being the President who got things running.
Yet the Big Four might not necessarily be the silver bullet that will knockout the country’s endemic problems of poverty, ignorance and disease. If anything, there has been some recent failures in these areas. And this ostensibly belies Jubilee’s bullishness.
First of all, these four are capital-incentive and offer no quick returns. Obviously, the aim is to spur economic growth which in turn, creates jobs. For example, regenerating agriculture-once the backbone of the economy- offers quick wins.
And surely didn’t all those countries that have turned the corner started first by feeding itself?
For a very long time, manufacturing has been stagnant. And it was not any better in the last five years. If anything, we have witnessed manufacturing companies such as Sameer and Eveready shift base from Kenya as the business environment got tough. And it was hoped that the much publicized entry of confectionary maker Wrigley or Volkswagen and Peugeot the car makers would trigger a stampede.
That has not happened.
Kenya’s challenges are not unique to it.
The reality is that all around the world, economies have contracted. Here, more than half a dozen banks have sent away their employees and nearly half of the firms listed at the Nairobi Securities Exchange have made losses or issued profit warnings and consequently purged off a significant number of staff.
These projects need heavy funding. In his first term, Mr Kenyatta attempted to adapt an expansionary monetary policy by capping the interest rates and thereby encourage borrowing by companies, individuals and banks. It is fair to say that that move has not given the desired results.
Moreover, while the real estate has been booming, few developers have been willing to sink their money into low cost houses that will cater for the bulk of those who desire to own houses.
In the last financial year, the Government lured developers with some tax incentives. It is too early to know the progress of the scheme.
So where will the money come from?
The president is well-meaning when he declares the intention to shift the economy from a predominantly rain-fed to a mechanised agriculture. Or the rolling out of universal healthcare. Those are noble undertakings and the president deserves commendation. Indeed, the country is still reeling from the after-effects of a debilitating drought that has left close to 4 million facing starvation.
And a lot of poor Kenyans still pay for their healthcare from their pockets.
One way of ensuring the Big Four becomes a success by Government finding a way of working with the private sector. In the last five years, the private sector has been brow-beaten.
The World Bank is afraid the Government has been driving the economy, not the private sector which is the biggest employer and main taxpayer.
One way to help the private sector grow is to ensure high uptake of credit. Credit uptake by the private sector has been the slowest a far cry from CBK’s ideal credit growth of between 12 per and 15 per cent.
If there is a lesson the UhuRuto duo should learn from former President Mwai Kibaki it is that it is the private that lays the golden eggs.
Essentially, what is needed are reforms that will open up the economy and free up money held by the Government.
Lastly, but not least, the view of this newspaper is that fixing the fundamentals of governance like addressing corruption will go a long way in addressing runaway joblessness and the attendant poverty. Indeed the World Bank has reported that each year, corruption alone, denies 250,000 youths a job and a livelihood. Perhaps the president could do his legacy some good if he started here. On its own, fighting corruption will give the desired quick win.