Why keeping time is a powerful catalyst for economic growth
In the coming weeks and months, Kenya’s 2018/19 budget will come under sharp scrutiny for a number of reasons. First and foremost, analysts will assess whether the Sh2.49 trillion budget is aligned to President Uhuru Kenyatta’s Big Four agenda.
The widening gap between expenditures and tax revenues, and the public debt it occasions, will also be painstakingly analysed. Kenya’s debt-to-GDP ratio has rapidly increased from 42.1 per cent in fiscal year 2012/13 to the current 54 per cent due to heavy infrastructural spending, a development that has sparked sustained debate around debt sustainability.
This debate has intensified following the successful issuance of the $2 billion Eurobond this February. Moody’s recent downgrade of Kenya’s credit rating and IMF’s unease over the country’s debt sustainability have also added fuel to the fire.
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Amidst the raging debate over the country’s public finances, it easy to give the budget preeminence over other underlying trends that have a greater impact on economic performance. The reality is that a budget, because of its focus on short-term revenues and expenditures, is not sufficient in providing a long-term vision for any economy.
Poor time management
Innovation, competitiveness and long-term economic performance do not exclusively depend on government spending vis-à-vis revenues or classic economic metrics such as debt-to-GDP ratio. They also, to a great extent, depend on the country’s underlying culture, which is often an overlooked factor in economic analysis. In the case of Kenya, one regrettable cultural trait that could undermine long-term economic performance is poor time management. Punctuality is a rarity in Kenya. From weddings to state functions, event programmes routinely kick off 30 minutes or an hour later than the stipulated time.
Meetings in private and public sector also rarely begin on time, especially if the host has an overbearing ego, as is embarrassingly the case with some senior state officials and top company executives.
If we want to unlock long-term economic growth and positon ourselves competitively as a nation, we need to prioritise punctuality and make it a defining part of our culture. Foreigners need to visit Kenya and go back to their respective countries awed and inspired by the punctuality of the Kenyan people.
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According to a research report by Macrothink Institute, a U.S. based research firm, time punctuality has a measurable impact on production and economic activity. The research cites Europe, saying that it is probably no accident that Europeans were the first to develop the mechanical clock, and, at the same time, to develop economically.
Chinese work ethic
China is another compelling example of the positive impact of punctuality on economic performance, competiveness and innovation. In less than 50 years, the Asian nation of 1.3 billion citizens has evolved from an agrarian backwater to a global industrial power, despite defying conventional economic theory and expanding its debt-to-GDP ratio from 160 per cent in 2008 to 260 per cent in 2016, according to data from Bloomberg. China’s debt is essentially five times larger than Kenya’s, underlining the fact that conventional metrics such as debt-to-GDP ratio are not the only determinants of long-term economic performance.
China is where it is because of the premium it places on time management. We saw this during the construction of Thika Road and continue to see it in other Chinese infrastructure projects. Chinese workers typically report to duty during the day and are supported by colleagues who work during the night, halving project implementation timelines. This explains why China is the preferred infrastructure partner globally and why the Chinese have done a stellar job industrializing and building cities in their country.
Evidently, punctuality cannot be overlooked when talking about economic development. We need to improve our time management skills as Kenyans or risk being outpaced by more time conscious neighbours such as Rwanda.
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Rwanda, which undisputedly has the cleanest capital city in Africa, is inculcating a culture of time keeping, with President Paul Kagame leading by example. In light of this, it is no surprise that Rwanda is now 41st globally in World Bank’s Ease of Doing Business and 2nd in Africa, edging out advanced economies such as Italy, which is position 46, and Israel, which is position 54.
President Uhuru Kenyatta has done well to articulate the country’s ambitious socioeconomic dreams through the Big Four agenda. Policy will be key in the implementation of this agenda, but a culture of punctuality will be even more integral.
Mr Kittony is the National Chairman of the Kenya National Chamber of Commerce and Industry (KNCCI) [email protected]
Big Four agendadebt-to-GDP ratioDebtTime management