The debate on the bottom-up economic approach as a means to empower people at the base of the economic pyramid has become an exciting political discussion in Kenya today.
Though the bottom-up approach has gained a lot of followers to an extent of propelling Kenya Kwanza’s political wing to power, how to implement it remains a challenge to the government and economic experts.
It is important to note that the bottom-up approach is just a platform or means of allocating and delivering resources down to the masses thus an elaborate method is required to identify the problems at the bottom and the resources required to empower the poor.
An inclusive economic or business model can work miracles if adopted and implemented as it should be.
This is a concept that ensures everyone, irrespective of gender, origin, age or background is given an opportunity to participate in either production or distribution of products.
The model seeks to create value for the people at the base of the pyramid by integrating them at the overall economic value chain, either at the supply side (production) or the demand side (distribution and consumption).
This, therefore, means that the people who allocate the resources are able to identify the economic opportunities around these people and provide the necessary resources that will help to liberate them from the chains of poverty using their own resources and capabilities.
The first step, therefore, is to identify and map the resources that are available and are underutilised in the counties and wards, understand the level of resources utilisation by the locals, and then identify the challenges encountered and the sort of help needed to fully utilise the resources.
First, on the supply side, this model will integrate the people into the production of the goods and services produced in their local areas and then through the aggregators look for the market at the local or international level.
The Kenya Tea Development Agency (KTDA) models offer the best example where 60 per cent of the tea produced in this country is by about 600,000 small-scale farmers.
The farmers are brought together under KTDA, and who mostly own less than two hectares of land under tea cultivation.
The farmers manage the tea collection centres and are also the main decision-makers in the management of the factories in their localities through elected directors.
This means the farmers fully understand their role in the tea value chain and even consume their products, even before they are sold elsewhere.
The government acts as an aggregator whose main role is to help look for the market regionally and internationally.
Last year alone, the government was able to earn Sh130 billion through the inclusive KTDA model.
The farmers were also able to earn about Sh63 billion across the country.
Some other additional benefits to the farmers include well-maintained infrastructure by the factories, affordable medical cover guaranteed by their produce and credit facilities also guaranteed by their produce.
This production inclusion model can be replicated in cotton, coffee, pyrethrum or any other resource available in the county economy.
Secondly, the inclusion of low-income earners can also happen on the demand side where they are integrated into the value chain as distributors of the products manufactured at their local levels.
For example, Safaricom uses this concept to distribute its money transfer services (M-Pesa) to its consumers by allowing small kiosks and other businesses to be their main distributors.
Banks also have agency outlets to take services closer to the people.
Through this, business opportunities are created for the low-income groups as they are integrated into these companies’ business value chains.
In addition, this has also helped to increase financial inclusion and access to those that are left out in the larger financial system.
It is high time that our debate moved away from just the merits of the bottom-up economic approach and adopt models that can help utilise devolved resources at the county level to create sustainable incomes for the rural folks.
- The writer is a lecturer of entrepreneurship and innovation at Kirinyaga University