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Build billionaires in innovation, not just through public service

Some of the CS nominees who have been vetted by the Parliaments Committee on Appointments.

As the vetting of Cabinet Secretary nominees comes to a close, one of the things that seems to have captured the hearts and minds of Kenyans is the wealth declarations.

As the various candidates disclosed their networth some made us gasp in wonder and at times with envy. People we have viewed to be as ordinary as the rest of us, suddenly put a huge value gap between them and us, as they declared themselves multi-millionaires and even billionaires. The question on the lips of many is how one gets to be a billionaire.

To understand Kenya’s billions and billionaires, perhaps the best place to start is where it all began – the United States of America. The US gave the world its first billionaire – Rockefeller, who built his empire around refining oil. The US has since produced several top billionaires in the world – Elon Musk, Jeff Bezos, Bernard Arnault, Bill Gates, and Warren Buffet – each with a networth well above 100 billion US dollars or 12 trillion Kenya shillings. Bill Gates topped the global list of billionaires for a long time until recently when he was overtaken by Jeff Bezos of Amazon and Elon Musk of PayPal, SpaceX and Tesla. What is noteworthy is that most billionaires in the US have built themselves from ground up, and with transparency on how they made their billions. Majority leveraged on creating the future and making fortunes through tech, computers, electric cars and online shopping.

Their wealth accumulation was mainly attributed to creativity and innovation – like Rockefeller who made changes to petroleum and oil products through refinery at a time when many were focused on drilling. Outside the US, China is growing into a farmland of billionaires. The nabobs of China have mainly reaped from industrialisation and the tech sector that have placed vast amounts of money in their hands.

Given the economies of such developed countries, the rise of billionaires and the billionaire culture is well understandable. This contrasts sharply with African countries characterised by huge gaps between the wealthy – especially billionaires – and the poor. For example, according to Oxfam International, less than 0.1 per cent of the Kenyan population, that is 8,300 people, cumulatively own more wealth than the remaining 99.9 per cent, that is 44 million Kenyans put together. Furthermore, the richest 10 per cent of Kenyans earned on average 23 times more than the poorest 10 per cent.

Whereas we cannot and must not appear to condemn wealth accumulation, we should however encourage transparency and accountability in wealth accretion. Just like for American, Chinese or other billionaires whose lucre clearly accrue from known wealth creation strategies, so also our billionaires should not cause a gasp when necessity forces them to declare their networth. Billions must not only be earned but be seen to have been earned genuinely and transparently. This is critical so that the financial worldview of the emerging generation is not based on falsehoods around wealth creation and accumulation. Otherwise, when the real sources of one’s billions remain opaque, it can only give rise to speculation, rumours and false impressions. Because if the billion is not backed up with the force and evidence of hard work, it diminishes in value and is instead seen as mere proceeds of questionable deals.

It is interesting that in Kenya, majority of the self-proclaimed billionaires are mostly politicians, former public servants, and the well connected to government. This creates false impression that connection to government is the easiest route to becoming a billionaire. Yet, we can emulate the making of global billionaires whose wealth has grown mainly through creativity and innovation. Like President Obama once observed, Kenya is a hotbed of innovation – always coming up with out of the box ideas. Our universities are equally consistently churning out breakthrough research findings. Unfortunately, such innovations and research findings go to waste as there is no commitment to supporting the individuals to commercialise them. 

As a nation we should perhaps come up with well-funded Innovation Incubation Centres where ideas can be nurtured towards commercialisation – like we did with M-Pesa that has become a global hit.