Ignore the naysayers, Kenya is still a viable and worthwhile enterprise

President William Ruto at the Commissioning of Naivasha Special Economic Zone sub-station in Naivasha, Nakuru county on January 13,2024. [Kipsang Joseph, Standard]

In the heat of the 1970s mid-term congressional campaign in the US, former Vice President Spiro T Agnew coined the phrase “nattering nabobs of negativism.” This was in reference to those critical of the Nixon administration policies.

No doubt President William Ruto has had his fair share of nattering nabobs apropos of his policies. But even the most ardent critic would be hard-pressed to refute the ineluctable facts that reveal these policies to be working.

Last year, one of the reasons for the fractious and violently confrontational street protests was the rising cost of living. 

Information from the Kenya National Bureau of Statistics (KBNS) now shows that inflation dropped to 5.7 per cent year on year in March from 6.3 per cent in February. This is the lowest it has been in two years.

Statistics further reveal that the decline in inflation has been informed by a drop in the prices of food items, fuel and electricity which, according to KNBS, cover about 57 per cent of household budgets.

There has been an uptick in positive responses related to the government’s handling of public debt. The international business community is now confident that Kenya will not default on her sovereign debt.

Consequently, Blackrock, which is one of the world’s largest asset management companies, has made an investment on the Nairobi Stock Exchange after a four-year break. According to the CBK Governor Kamau Thugge, Kenya is one of 10 economies that Blackrock has selected for investment.

Another positive development is news of 31 new hotels in the pipeline this year. A report from the Hotel Chain Development Pipeline Africa shows, “ongoing and planned construction will bring an extra 4,268 rooms.” The report further adds that this “signals the continual recovery of the tourism and hospitality sector even as visitor numbers keep soaring.”

Conflated to this is the fact that the national carrier Kenya Airways has recorded an operating profit of Sh10.5 billion for the first time in seven years. This was a reversal of an operating loss of Sh5.6 billion a year earlier and was reflective of a faster growth in revenue compared to operating costs.

A commentary in the airline’s audited group results reveals that passenger numbers grew 35 per cent to 5.08 million. The group’s total revenue increased by 53 per cent to close at Sh178 billion, the highest in the company’s history.

The Kenya shilling has, over the last couple of months, steadily appreciated against major currencies globally. It has led to a reversal of the vicissitudes that had plagued many companies whose transactions have a component of foreign-denominated currencies.

Kenya Power, for instance, is able to sell cheaper power to consumers on account of forex adjustments on power bills. Petroleum products are now also cheaper with petrol pump prices reflecting every gain in the shilling.

But for a hit of Sh24 billion on account of forex changes last year, Kenya Airways would have recorded a net profit of at least Sh1.5 billion. What the nattering nabobs of negativity should appreciate is that, like the national carrier, this country may not be out of the woods yet. But such positive developments show that Kenya has not only sound fundamentals but is a viable and worthwhile enterprise.

Mr Khafafa is a public policy analyst