Monday, November 8, 2010
Kenya's growth- but what about trickle down economics?
Interesting day: and when I got back to work boldly wearing my WEF ( World Economic Forum) tag, I got a tweet from my boss saying: “ Ati CEO round table?”
We laughed about it, but I’m sure that’s perhaps a question that I have and will have to answer in the course of the evening (until you get to read this post- at least)
At 8.30 this morning I made my way to Crown Plaza in Nairobi’s Upper Hill area, where Africa practice's Godfrey Chesang had invited me to.
It isn’t everyday that the country’s top CEO’s and government officials otherwise known as policy makers are in one room, and accessible for questions and open discussions about the path that Kenya is taking towards economic stability,
The CEO round-table is organized by the World Economic Forum, and this time round the theme was: Assessing Kenya’s Competitiveness, which was derived from the Global Competitiveness report. Kenya was ranked 106th in the Global Competitiveness Index 2010-2011, while Rwanda was ranked 80th. The focus of the report was on Infrastructure, Institutions, macro economic environment, health and primary education, financial market development, business sophistication, innovation among others.
The Prime Ministers opening speech, which touched on success stories from Kenya (of course with great PR for the government,) and not to be too harsh, the government has made commendable steps; but that is just the beginning. To piggy back on that, one Dr. Nyoro put it, that sometimes; we need to take time to celebrate the positive steps the government has taken. (He was however quick to point out that he is not a government apologist.
Raila Odinga talked about reforms that have enabled business thrive, and a case in point is the Narok county council which has up to now doubled its new business licenses within Narok County. This, he said is just one of the many steps the government has taken towards improving the business climate for entrepreneurs in the country.
He also spoke about challenges; where corruption stuck out as a sore thumb. Mugo Kibati, CEO of vision 2030 added that what we need is a mindset change.
From the lively debate created by the Premier’s presentation it was clear that corruption was an issue that needed to be tackled from both sides, and not just the top down approach as we have seen in recent weeks. It is one thing to blame the man on the driver’s seat, while the passengers could actually be the culprits as well. One Beatrice Waka, talked about the lethargy and lack of professionalism in the public sector, where public officers act as if they are doing (citizens) a favor by doing what is in fact their work.
After the presentations, the microphone was taken to the floor, and one of the major topics that I picked on, and would like to elaborate on here, is; with the growth rate at 4.5%, targeted to reach 10% in 2030, and inflation levels just above 3%, what next? Is this about Big Business and what happens to trickle down economics?
One of the questions I get, and usually anticipate as a business journalist especially when I cover events to do with the Macro Economic growth of the country, people as me “ so what?” what does this mean for me, if the cost of bread is higher than it was 4 years ago?
So, is this about trickle down economics?
I asked the PM about feedback analysis. Africa knows its problems. Year in, year out, we keep talking about alleviating poverty, empowering the bottom end of the pyramid, etc; reports after reports are done, task force after task force, but the same topics are still the main highlight of economic fora not just in Kenya, but across Sub- Saharan Africa, and frankly, its tiring. So I asked the premier if reports, or meetings like this actually trickle down to government boardrooms, and if anything is done to them.
He didn’t really answer my question. Raila talked about the National Economic & Social council, and how the task force meets constantly to review the growth and advise the government on the same. With the recommendations given by several great minds and best practice as seen in country’s like Rwanda( one Cow per Home) and the Malawi Miracle, when do we stop being a talk shop and actually walk the talk? Im sure this is a question I will ask again.
And I will not tire.
Part of the forum included discussions, where we focused on Kenya’s comparative advantages, weaknesses, a projection of what Kenya will look like in 2030 as well as sectors that will drive Kenya’s growth, and on the flip side, factors that may curtail that growth. Microsoft’s Louis Otieno raised the issue about Energy, specifically over dependence on oil and with that comes the opportunity of exploring and investing in alternative energy.
Geo politics was another issue. Kenya is a corridor not just for the regional economies, but for Western giants who invest in countries across East Africa, and it emerged here that the business minds are concerned about the political stability of neighboring countries, and how, going forward this may impact growth. It raised the question of Kenya’s stand and participation in regional peace.
Infrastructure, specifically roads and air transport was a major issue across the different discussion groups, and my take is that the roads are like the trade winds of the past, opening up different regions to not only trade, but development that comes with urbanizing the rural areas.
These are just some of the highlights of the event that made my day very satisfying; my only hope is that the great ideas generated from the round-table will be converted into tangible results.
On my way out I spoke with Kencall’s Nicholas Nesbit, where we spoke about asking the right questions, even if they are not answered. My stay at crown plaza ended with the agreement that sometimes, one has to ask the hard questions, even if it is just to make a statement.