Transport chaos a true reflection of all that is wrong with the economy

Unfortunately, while the Hustler nation dreams big for the country, they have made not a single attempt to bring order into the sector. Am not sure whether even the current Cabinet Secretary has any idea of how millions of Kenyans get by on a daily basis. This is a continuation from his predecessor in the docket.

It is instructional to remember that the current state of affairs is a major relapse from the order created by the famous Michuki rules in early 2003. With hindsight, we can look back and draw the vital lessons from the Kibaki administration's decisive action to bring sanity in the road transport sub-sector soon after assuming office.

While I in no way attempt to imply any direct causation for lack of a structured evidence, a casual perusal of the economic data demonstrates that the 2003-2007 period is one of the most consequential in recent history. This is largely the period within which the Michuki rules were complied with to a great extent.

Conflict of interest

Things started going down the drain when Chirau Ali Mwakwere took up the Transport docket in December 2005. He would later publicly disclose a direct conflict of interest when asked why he had tolerated the relapse on implementation of the rules. Things were however reset into the old order when the immediate former president, Uhuru Kenyatta, openly chided some of the rules, arguing they limited the creative and gig economic activities.

The recent spat between the Deputy President and the Governor of Nairobi about club operations within residential areas provides insights as to why no intervention may happen anytime soon. Majority of the profiteers from the chaos in the sector may reliably be presumed to identify with the Hustler philosophy.

The same is reflected in the chaos that has become of the Nairobi City streets that have been taken over by hawkers of all manner of items. It does not matter what time of the day or day of the week it is. Sometimes, it is difficult not to sympathise with investors who are doing business within fixed premises.

For instance, what do you make of an environment where shoes and clothes are hawked right at the doorsteps of Bata shops and clothes stores? The store owners pay hefty business permits and levies to the County Government to operate while the hawkers pay no single penny? What sort of business environment is this?

For avoidance of doubt, the transport and storage sector is not peripheral in the country's economic structure. According to the Economic Survey of 2022, it is the second largest contributor to the gross national output after agriculture, forestry and fishing. Total output for the sector stood at Sh2.3 trillion in 2021. The road transport sub-sector accounted for 77.9 per cent of this output at Sh1.8 trillion.

Intuitively, this is by all accounts the most liquid sector of the economy, turning over billions of shillings on a daily basis. It thus potentially offers the shortest route to create employment and expand government revenues should it be streamlined to be more open and accountable. Besides, it offers enormous political capital to the government in terms of assuring safety for both persons and goods; bolstering national security; and minimising opportunities to clean dirty money within the economy.

Take, for instance, the cost to the economy of the 4,432 lost lives on our roads as at 15th November, 2022 as per NTSA report. Many more were maimed with the consequent medical costs taking a toll on the victims' household incomes, their local communities and public healthcare expenditures.

The plausible questions to ask here are: Why would a reasonable government want to preside over such chaos in a sector so central to the economy? How do policy makers intend to stimulate other sectors of the economy that must depend of a chaotic one for movement of merchandise, supplies and human capital? Why is there no will to right a sector that obviously stinks to the heavens?

What's at stake?

In an article posted on www.britannica.com, Donald F. Wood enumerates several benefits of transportation economics to a country both at the macroeconomic and microeconomic levels. At the macroeconomic level, transportation contributes significantly to the Gross National Product directly and strengthens the economy through facilitation of communication and commerce.

The transport infrastructure is a key pre-requisite for economic development and a fertile ground for inventors, innovators, entrepreneurs and the supporting investors as they seek to establish the most effective and efficient means move to labour, goods and services within and across borders. Effective and efficient transport systems allow regions and countries to specialise on where they have competitive advantage and trade with other regions and countries for what they cannot produce competitively.

Besides, the transport systems highly influence exploitation of natural resources, development of human capital, value of land and employment opportunities within and across the economy. For instance, the value of land within Nairobi significantly and directly depends on associated travel times and costs to access places of work by the city residents.

At the microeconomic level, the sector impacts individual productivity, access to employment and investment opportunities for business across the value chain.

Despite all this well documented benefits to the economy, it is inconceivable why a government that dreams of reordering the economic fortunes of the country and boost government cash flows will not be keen on re-setting the subsector as a matter priority. We all know powerful gangs and cartels have appropriated city routes and upcountry corridors to themselves.

In the absence of formal government controls, these gangs extort illegal taxes, monopolize transport corridors and dictate prices to consumers. Unfortunately and tragically so, the security apparatus and powerful political operatives are part of the biggest profiteers. Inevitably also, the sector offers a fertile ground to smuggle illegal and clean dirty money. This is a true reflection of how a bandit's economy looks like!