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Pandora Papers leak and the question of financial openness

By Leonard Khafafa | October 6th 2021
President Uhuru Kenyatta and former British Prime Minister Tony Blair after a courtesy call at State House, Nairobi. [Courtesy]

According to Greek mythology, Pandora was a woman of insatiable curiosity. Given a box in which every conceivable evil was deposited, she couldn’t resist lifting the lid to take a peek. This is even after she had been warned never to open the box. Because of her disobedience, evil has been visited on the world of humans.

The dictionary defines Pandora’s box as, “a process that once begun, generates many complex problems.” This is an apt description of the recently released Pandora Papers that have discombobulated many leaders globally. This is an offshore data leak that links global leaders with secret offshore companies and accounts ostensibly to hide wealth.

President Uhuru Kenyatta and his family have been tied to at least seven such companies and accounts. However, the papers exonerate the Kenyattas from being beneficiaries of any proceeds of crime. Kenyatta has issued a statement saying that “the reports will enhance the financial transparency and openness required in the country and globally.” He promises a more comprehensive statement later.

It is not illegal for any Kenyan to own offshore entities. But the Kenya Constitution regulates the conduct of State officers with regard to these. Section 76(2)(a) reads,” A State officer shall not maintain a bank account outside Kenya except in accordance with an Act of Parliament,” It follows then that the president, holding a position of public trust as a State officer, has to be an open book in his financial dealings.

The president has, in the past, sought to make public his wealth. In a BBC interview in 2018, he said his family wealth was known to the public and that he had declared his assets as required by the law. The public hopes the anticipated statement from the president will reveal the entities mentioned in the Pandora Papers either to have been sufficiently covered in the Kenyattas’ wealth declaration or left out as an oversight to be corrected in due time.

Giving the benefit of doubt to the Kenyattas about the legitimacy of their offshore entities, the Pandora Papers still put a spotlight on the lives of the ruling elite. Such massive investments overseas are deemed by some to betray a lack of confidence in the country’s investment environment. They are regarded as a continuation of a trend where the elite place little faith in local institutions.

Their children attend international schools and are instructed in foreign curricula. They themselves are treated overseas for minor ailments. While the rank and file are shoring up the economy with diaspora remittances earned, most times, from menial jobs, the well-heeled are doing the polar opposite, aiding capital flight by investing abroad.

Whilst the Jubilee administration has been big on talk, it has shown little aptitude for reversing grand corruption. It has instead, according to those on the receiving end, weaponised the war on corruption so that only those who have fallen out with powerful State mandarins are charged in courts of law.

The Pandora Papers have therefore elicited a lot of excitement as they cast those who appear to ride moral high horses in less than flattering light.

Supporters of Deputy President William Ruto are excited. To them, the Pandora Papers are a boon that helps to confect a simmering war between the DP and his boss.

They claim the papers dismember a core narrative about the DP as being the godfather of corruption. Instead they point at individuals close to the ruling elite, indicted for hiding stolen public funds in Jersey, a tax haven. Yet these walk about freely in the country even as their extradition to countries where they have violated financial laws is sought.

The president has in the past stated publicly that he will not leave the country to thieves when he retires next year. One hopes that when, as he has promised, he lifts the lid on his family’s affairs, they will reveal the “financial transparency and openness required in Kenya.”

Mr Khafafa is a public policy analyst

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