Myriad blunders turn Kenya’s economic dreams into a nightmare

Kenya celebrated another Jamhuri Day on Thursday even as the cloud of a failing economy hangs over its 47 million people, with successive governments having fallen short of their own targets through financial blunders that have turned the country’s independence dream into a mirage.

PROFIT WARNINGS

For over five decades, every president has promised to better the lives of Kenyans. To afford Kenyans the post-independence dream of fighting poverty, ignorance and disease.

But the performance of the economy remains one of the poorest kept promises by the administrations, which have taken Kenya off the path that its peers like Singapore took.

Today, the country is dangerously addicted to debt. A growing number of companies are reporting distress and profit warnings while others are firing staff to remain afloat. The Kenya Revenue Authority (KRA) has weaponised tax collection. Millions of youth continue to struggle to find meaningful employment. As the country marks 56 years of independence, it is worth asking who among the four presidents has managed the economy best.

A detailed analysis by the Nation reveals that despite a shaky start, Kenya’s founding president Jomo Kenyatta was the best manager of the economy. The current regime (if it were to leave office today) comes in second, followed by the Kibaki government. President Daniel Moi’s was the worst regime for the economy.

ASIAN TIGERS

When Jomo Kenyatta took over from the British in 1964, the economy had been growing at its fastest pace. Two years before he took over, the economy had contracted by 7.8 per cent as Kenyans started pushing for freedom. It quickly turned around to grow at a rate of 8.8 per cent in 1963. However, this was still under Queen Elizabeth.

Growth trajectory

In his first year in office, the founding president grew the economy at five per cent before it tumbled to two per cent as he learnt the ropes.

In his third year in office, he reversed the negative trajectory and put Kenya back on the path that would have had it at par with the Asian Tigers if the momentum had been kept up.

On average, for the 15 years Jomo Kenyatta was in power, the average Gross Domestic Product (GDP) growth rate was seven per cent. In 1971, GDP grew by 22 per cent, the biggest ever since independence. His worst year was 1970, when the economy shrunk by 4.7 per cent.

COST OF LIVING

The 24-year Moi rule was the worst for Kenya as the economy, on average, grew by 3.2 per cent. His best year was 1979, a year into his rule, perhaps reaping from the momentum built by his predecessor. Years later, in 1992 the economy shrunk by 0.8 per cent.

In the Moi government, the economy kept hopping from growth to contraction. At some point, the economy was expanding at negligible rates, which was wiped off by the rising cost of living.

President Mwai Kibaki would come in to rescue the sinking ship in 2003, and start pumping life back into the economy. During his term, the economy grew by an average of five per cent.

His best year was in 2010 when the economy grew by 8.4 per cent, recovering from the post-election violence of 2008. The second best performance of in the administration was in 2007 when the economy expanded by 6.9 per cent.

CHILD MORTALITY

The post-election violence significantly slowed the economy to 0.2 per cent growth in 2008 before picking up after the Grand Coalition Government was created. It was against this background that President Uhuru Kenyatta took over.

In the six years the Jubilee government has been in power, the economy has been expanding at an average of 5.7 per cent, with last year being the best so far after the GDP grew by 6.3 per cent. The worst performing year was 2017, when the economy grew by 4.9 per cent, catching a cold from the prolonged electioneering period.

Based on quality of life, Kenya has made great strides in terms of lifespan and child mortality rates.

"With better health and nutrition, Kenyans today are living nearly twice as long, on average, as their fathers did at independence,” President Kenyatta said in his 2018 Jamhuri Day speech.

BIG FOUR AGENDA

"Moreover, far few mothers die in child birth. We have cut child mortality to a quarter of what it was in 1963,” he added.

At the last Jamhuri Day celebrations, the Jubilee administration unveiled another blue print — the Big Four Agenda — that puts food security, affordable housing, manufacturing, and affordable healthcare for all at the centre of its activities.

"The residents of Isiolo, Kisumu, Nyeri and Machakos counties will receive free healthcare services in all health facilities, from their local health centres, all the way to their referral facilities," Mr Kenyatta said during the event. A year down the line, it is just one of many failed promises.