2025: Will political sycophancy derail Kenya's pursuit of economic reform?

The National Dialogue Committee co-chair , National Assembly Majority Leader Kimani Ichung'wah at a session during the Kenya Kwanza Alliance and Azimio la Umoja coalition Bipartisan talks at Bomas of Kenya ,Nairobi on 31st October 2023 [David Gichuru,Standard] As we step into the hopeful embrace of 2025, let's randomly walk through a couple of unusual reflections for the year. We start with two recent observations. The first, obvious one is the current surge of self-righteous anger from our political leaders. These figures seem intent on both threatening and chastising young people, all the while scaling moral high grounds to sanctimoniously advise them on how to behave better. This scenario is as shabby as it gets in terms of new year beginnings. The result is that Gen Z may quickly transform into Gen Zote at lightning speed. One of my professional colleagues, bemused by the turn of events in 2025, crafted a "Sycophancy and Political Bootlicking Regulation Bill" as a satirical comment on the political circus. The bill aimed to "regulate, prevent and criminalise sycophancy and political bootlicking" while promoting "responsible political discourse, accountability, and integrity in political engagements". Of course, such a bill is destined to never see the floor of Parliament, especially under the current house leadership. Yet, if the usual political spectacle continues as anticipated, we might as well pack up and wait for 2027. In the meantime, we are likely to see endless rallies and social media "mchongoano". The second, perhaps less obvious observation, concerns the dreadful traffic congestion witnessed on the Nairobi-Nakuru highway during the holiday period. A colleague noted that Kenya has largely ignored the hidden wealth to the west of Nairobi, which has been compounded by a failure to address historical economic injustices. The prevailing notion has long been that Nairobi, alongside Central Kenya, contributes a disproportionate 60 per cent to the national economy, leaving the remaining 40 per cent for the rest of Kenya. However, thanks to devolution, we now have data-courtesy of the Kenya National Bureau of Statistics-to challenge this age-old assumption. Using 2022 Gross County Product (GCP) data at the county level, we can debunk the myth of Nairobi and Central Kenya's economic dominance. When grouping counties into their former provincial structures, the national cake breaks down as follows: Nairobi and Central account for 40.3 per cent, Nyanza, Rift and Western contribute 37.3 per cent, while Coast, Eastern and North-Eastern account for 22.4 per cent. This revised understanding opens up the conversation about historical resource-sharing inequalities, particularly when it comes to the distribution of roads, schools, and hospitals. In this context, it is "the rest of Kenya" that constitutes 60 per cent, not 40 per cent, of the economy-food for thought. The purpose of counties was to dismantle the colonial legacy of provinces, creating a new micro-level of governance. While the macro-level, "Kenya," remains intact, we now have counties and regional economic blocs (RECs) as a meso-level. If we consolidate these RECs geographically, the national cake can be divided into four roughly equal portions: Nairobi (27.5 per cent), Mount Kenya (Central Region Economic Bloc, including Nakuru and Laikipia) at 24.5 per cent, "The West" (Lake and North Rift Economic Blocs) at 28.2 per cent, and "The Beltway" (Coast, Frontier Counties, South-Eastern Kenya, Narok-Kajiado Economic Bloc) at 20.2 per cent. This is the national cake. Looking ahead to 2025, it's time to shift the focus from the broad-based (inclusive) government, which dominates political discourse, to creating a truly broad-based (inclusive) economy-a key goal of devolution. As I often point out, the government is not the economy. While we work to bake the national cake, we must consider the proportions of inclusion in this process. This 2022 data is over two years old, prompting the question of how the cake's proportions may have shifted as the economy grows. The year 2025 follows 2024, a year in which we acknowledged the efforts made towards stabilising the macro-economic fundamentals. However, with Q3 Gross Domestic Product (GDP) growth recorded at a modest four per cent, it is likely that overall annual growth fell short of expectations, likely somewhere between 4.3 per cent (based on post-Covid trends) and 4.7 per cent (as suggested by Stanbic PMI's observation of strong Q4 activity). The original The Bottom-Up Economic Transformation Agenda (BETA) and the Fourth Medium Term Plan (MTP IV) growth target of 6.3 per cent was revised down to a more modest five per cent. We now urgently need to replace the "we've stabilised the economy" T-shirt with one that reads "transformation is on course". Though many argue that 2025 represents the final working year before the political campaigns of 2027, I see it instead as the midpoint of this administration's term-month 28 of a 54-month term, with campaigns looming in the distance. As tempting as it is to focus on predictions, 2025 presents us with a moment of uncertainty. Rather than relying on forecasts, let's instead consider possibilities. Or, more specifically, we can reflect on scenarios. Though often underappreciated, scenario planning is not new in Kenya. The Institute of Economic Affairs (IEA) has been a thought leader in this area for over a generation. Back in 2000, the IEA developed four scenarios looking 10 to 15 years ahead (to 2010-2015). The first, a "status quo" El Nino scenario, painted a picture of a fractured Kenya. The second, a development-focused "Maendeleo" scenario, envisaged an economic reordering that ultimately failed to address Kenya's political dynamics. The third, the politically-aligned "Katiba" scenario, prioritised democratic and institutional reform over economic transformation. Finally, the "Flying Geese" scenario imagined a radical national transformation, combining inclusive democracy with economic growth. The IEA's scenarios for Kenya's future, developed post-2002, were not predictions, but possibilities, offering insight into Kenya's trajectory. These scenarios, particularly prescient after the 2007/2008 post-election violence and the 2010 Constitution, highlighted various paths for the nation's growth and challenges. More recently, the IEA outlined four scenarios for Kenya in 2040, including: "Eastern Sunset," where the state is ineffective, "Managed Stagnation," where state capacity improves but fails to support the private sector, "Jua Kali Kingdom," where policy favours the private sector but weak institutions hinder progress, and the "Kenyan Dream," a prosperous future driven by private sector growth and improved state capacity. These long-term scenarios offer a foundation for reflecting on Kenya's current position. They represent possibilities within two dimensions-political institutions and economic policy. Given the current environment, let's explore short-term scenarios for 2025. In the Chaos scenario, the BETA economic agenda is abandoned as politics dominate ahead of 2027. The IEBC becomes central to political manoeuvring, and alternative voices are silenced, leading to a bleak economic outlook. The Chess Game scenario focuses on institutional reform, but BETA remains largely symbolic. While less politically intense, this scenario doesn't bode well for economic progress. The Cacophony scenario is marked by high-stakes politics, yet aggressively pursues BETA's micro-economic reforms, building on existing macro-economic stability. This noisy but reform-driven path could push economic progress forward. The Camelot scenario represents the best-case outcome, balancing institutional reform and aggressive micro-economic reforms, setting a foundation for long-term growth. If we consider probabilities, 2025 seems set for a 70 per cent chance of Cacophony and 30 per cent of Chaos, with Camelot feeling out of reach. To paraphrase the Chinese saying: in 2025, "prepare to live in interesting times."

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