Inside Mwai Kibaki's brilliant economic thinking

Mwai Kibaki tabled a six-year development plan for the country between 1964 and 1970. [File, Standard]

Departed former President Mwai Kibaki was Kenya’s longest-serving minister for Finance and among the few who have left the docket with their reputation intact.

Between 1969 and 1981, two presidents - Jomo Kenyatta and Daniel Arap Moi - entrusted Mr Kibaki with overseeing the ever contentious decision of allocating the country’s scarce resources.

A London School of Economics trained economist, the late former President, who passed on last Friday, had already imprinted his name in planning for Kenya—then a young country trying to wean itself off colonial-era disruptions.

He had from July 1963 served as Parliamentary Secretary for Treasury, going on to table a six-year development plan for the country between 1964 and 1970.

Mr Kibaki opted to split the implementation of this plan into two phases - wisdom that would for many years be applied even when he later rolled out the Vision 2030 economic blueprint as President in June 2008.

“It has been found through experience in other countries that shorter development plans are more practical,” he told Parliament then.

The plan promised to help the economy yield Sh7.28 billion by 1970 and increase the average income of each family by Sh4,000 a year.

It also provided for an improvement in education, health facilities and housing schemes and set up a provident fund.

Mr Kibaki said, in the absence of enough food to eat, good houses to live in and good clothes to wear, “independence will be a shame.”

His maiden Budget speech was on July 3, 1970, when he presented the spending plan before the House, calling for increased participation in building the economy.

He would in 1973 face one of the major headwinds while handling the finance docket: the global oil crisis.

The oil crisis, for instance, saw the price per barrel soar from $4.10 in December of the same year to $13 in 1974.

Mwai Kibaki. [File, Standard]

For oil-importing countries like Kenya, prices going through the roof meant a higher import bill and a strain on dollar reserves.

In 1974, Mr Kibaki intervened through measures such as the Local Manufactures (Export Compensation) Act to provide for compensatory payments in respect of certain locally manufactured exports to boost the dollar reserves.

He would in 1977 also face the challenge of dealing with the collapse of the East African Community (EAC). This required revising Kenya’s plans to reflect the new realities.

Mr Kibaki had to lead the team that oversaw the transitioning of Kenya from the EAC, including the sharing of assets among member states.

Then in 1978 came the death of his boss, President Jomo Kenyatta, putting to test the plans of a young country.

Mr Kibaki was retained in the docket by the late President Moi who succeeded Mr Kenyatta the same year. Mr Moi also made him the Vice President. Mr Kibaki would later succeed Moi in 2002.

He was later appointed the minister of Home Affairs, continuing to double up as the Vice President but relinquishing the Finance docket to Arthur Magugu in 1982.

While other finance ministers, including Chris Okemo, David Mwiraria, Amos Kimunya and Henry Rotich exited the position with tainted legacy,

Mr Kibaki’s legacy has been one that his successors continue to study.

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