In this unusually cold July, there appears to be a lot of political heat and noise, seemingly designed to divert attention from serious concerns of entrenching the economy. Repeating assertions of likely friction within the Jubilee Party is juicy political titbits. In the process, the high thermometer and decibels entertain by distorting realities of other activities and concerns as well as cries and celebrations that Kenyans engage in.
Many people and entities desire to contribute to the Big Four only that they are not sure of how to go about it especially when they find man-made political obstacles along the way. They would want those obstacles removed in order to allow for long term transformation commitments that should transcend presidential terms.
There are drawbacks that generate lamentations and elicit cries for help. In the forefront of the cries for help are potential investors who experience myriads of structural and manmade frustrations. Kenya is seemingly suffering from an oversupply of well-staffed and paid regulatory organs, parastatals, and commissions that often duplicate and contradict each other.
In the process, they raise the starting cost of any undertaking and make it difficult for potential wealth-creators to create wealth and thereby undermine the Big Four. Most wealth creators borrow money from lending institutions to put their ideas into effect. At present, however, banks are mean and are reluctant to lend. Only microfinance houses appear willing to lend a little to investors.
The reason for the bank unwillingness to help the investors, it turns out, is two-fold. First, the banks are unhappy that the government put interest rate restrictions on the spread between lending and borrowing. They want to pressure the state to reverse that.
Making money availability difficult for ordinary borrowers is one way of putting pressure. Some banks have reportedly scaled down on “corporate social responsibility”, probably as a way of expressing displeasure. Second, the government has compounded the situation by borrowing huge from the domestic market to finance its growing budget.
It is thus competing with local borrowers for the same money. To the banks, government bonds pay high interest rates and are more reliable than lending to individuals. They then dismiss other borrowers as high risk and fail to give needed loans. This failure undermines wealth creation and those with initiatives.
Then there are irresponsible behaviours by political leaders, whether appointed/nominated or elected. It appears as if there always is plenty of public money for political leaders, and some take pride in blocking people from doing their work and seemingly get away with it. Some MCAs refuse to pass county budgets until they are bribed and others allocate hundreds of millions of shillings to construct new houses for governors, deputy governors, and speakers. They also fight in the assemblies.
Yet the overtaxed citizens lack water, access roads, medical care, or school facilities. Such extravagance makes people wonder whether they should be paying taxes to be fleeced by officials with little sense of civic responsibility.
While such challenges feed into the twin political heat and noise, they do not render the positive aspect of the Kenya reality negative. Opportunities for celebrations still come in assorted ways. Nairobi’s Jomo Kenyatta International Airport, as an air transport hub, is ranked top in Africa and 38th in the world. Kenyans still win medals and athletes continue to thrill citizens with their victories. Kenyan high school students win medals for ingenuity by beating many other countries in global Genius Olympiad.
The media are vibrant, expose bad things like corruption, support the positive in the Big Four, and are part of rejuvenating Kenyan state. An increased number of functional airports shortens and lessens travel time cost, and so do the roads and railways.
The subsequent reduced time and costs are new incomes in the form of accrued savings that people use to create additional wealth, or waste to their liking. And the adventurous among the Kenyans keep coming up with innovative ways of growing the economy while making a living.
Prof Munene teaches history and international relations at USIU; [email protected]