So, assuming that Azimio la Umoja One Kenya can sustain either the Bomas of Kenya Talks or yet another wave of protests, what is the end game really? Kenya’s history shows that the prize is likely to be an elite compromise by which a power sharing arrangement of some form or shape may be struck. William Ruto has said he will never do it, and Raila Odinga has said he doesn’t want it, but this is what is going to happen. There is no other way for the two protagonists to walk away satisfied. The status quo ante bellum is such that their hands are tied; they are in the same boat.
However, the question I’d like to ask is, what is Kenya’s prevailing status quo?
After six decades, a dominant oligarchic establishment now exists with complete and integrated control of finance and land. This is the successor to rent-seekers within the first two presidencies and their civil services. Following the 2022 presidential election-upset which saw William Ruto narrowly defeat the establishment candidate, Raila Odinga, there is a large and diverse new political leadership in Kenya which apparently seeks to emulate its predecessors in terms of accumulation. But they took power during a perfect storm of economic crises, and their ambitions can only be met at the expense of the ancien régime, or with its concurrence; i.e. by consensus, or elite compromise.
However, conditions permitting this primitive form of governance have drastically changed since it was first broached between Jomo Kenyatta and the white settlers pre-independence. Jomo Kenyatta was deified and later so was his chief opponent Jaramogi Oginga Odinga. Today, apart from Raila Odinga, Kenya’s leaders are not the near-gods of the independence days. For good reason, trust in government and leaders is at an all-time low – what Kenyatta and Daniel arap Moi once got away with is intolerable today. The elite compromise trick may have run its course.
Kenyans today have their eyes open about bad governance and the status quo of high levels of corruption and weak rule of law. Despite sympathy for his concern for the cost of living, many blame Raila and his “ handshake” with Uhuru Kenyatta for the collapse in the checks and balances between government and the opposition that resulted in well documented corruption and arbitrary expenditure including the KEMSA COVID-19 PPE scandal, the massive expenditure on the failed Building Bridges Initiative project, and the near-killing of Mombasa as a harbour city following the transfer of clearing and forwarding of imports to Naivasha – 570 kilometers inland. In the last days of the Uhuru Kenyatta administration, over KSh 15 billion was paid out on a single afternoon without the approval of the Controller of Budget – she claims she was forced to retrospectively clear the payout.
But Ruto’s administration is no better. Two examples should suffice; a new Housing Levy raids worker’s wages to benefit building contractors and so-called developers, even as the overall project is dubious in terms of impact and opaque. A decision to re-establish a moribund trading parastatal, the Kenya National Trading Corporation (KNTC) has yielded its first scandal with the revelation that tax free imports of cooking oil and price inflation has gifted certain middlemen $6 per litre on the importation of an equivalent of 6.25 million 20L jerry cans of cooking oil. The Daily Nation estimates the haul at close to $41.5 million. Corruption is being tracked, for the first time, in real time.
Through all this, Kenyans endure high levels of extreme poverty (over 7 million live below the World Bank Poverty Line of US$ 1.90) and one-in-every-seven-working-age youth is unemployed. The elimination of fuel and maize flour subsidies was very unpopular, regardless of the economic merits of the decision, and has sowed the ground with seeds of agitation. But I would urge the opposition political elite to consider that they do not have the monopoly on opportunistic agitation.
What am I implying, you might ask? Well, unless the genie is put back in the bottle, even our most skilled politicians could lose control of the young and angry they have hitherto claimed to lead.
A plan must be made for the young and angry. Batons charges, teargas volleys and live bullets will do nothing to quash their nothing-to-lose bravado. Changing their economic circumstances will. But we have facts on the ground, hard baked ground, because of decades of negligent and uncaring government. Even after Azimio’s maandamano ends, we will have essential economic realities to contend with. We have a high debt and interest burden arising from commercial borrowing for infrastructure that has yet to yield return on investment – e.g. the Standard Gauge Railway (SGR). The debt service to tax revenue ratio rose from 17.5 percent in 2014 to close to 50 percent in 2022 – twenty points above the IMF recommended threshold.
COVID 19 and the war in Ukraine demonstrate how sensitive the Kenyan economy is to global political and health crises; and it is clear that there is high exposure to environmental risks posed by climate events on the economy and government finances. For instance, in almost half the Counties, up to 5.4 million Kenyans were reported to be facing high levels of acute food insecurity in June 2023. That is 10 percent of the overall population.
The end of the COVID era creditors’ relief (the Debt Service Suspension Initiative) in December 2021 coincided with the end of the grace period for China’s loans to Kenya, including the SGR. Since then, China must receive semi-annual payments on its $6 billion-plus of loans. For the 24 months between January 2002 and December 2023, a total of $6.5 billion fell due on all our debt. Since taking over in September 2022, Ruto’s administration has paid $2.569 billion. From July to December 2023, the government must pay a further $1.453 billion. Perhaps, thE President would have rather subsidized food and petroleum, but these are the cards he was dealt.
Leaving aside serious questions about the legitimacy of the national debt, the facts are that monthly total debt service, including to bond holders, is KSh 37 billion. So, as David Ndii rhetorically challenges us to consider the overthrow by force of the Ruto presidency as an end game, there are no prospects of Raila Odinga actually solving the problems he is claiming maandamano will solve.
The status quo ante bellum will remain the same until the Government of Kenya is able to convince Kenyans that their taxes are being put to work for them, and that ultimately we must have an agreeable Finance Act 2023 to authorize the expenditure of the State without disenfranchising the masses. Without this confidence, we will default on repaying our national debt, domestic and international within the next year. We will be cut off from the global financial system – and that would not be a good thing.
PS.
I have always argued that the Azimio is well represented in our county and national legislatures and executives. It has zero reason to hit the streets apart from cynicism and opportunism. Their judgment will be written by history. All we know for sure at this uncertain moment is that our economic problems won’t be resolved by a magic wand or merely by a change of guard in State House. Political risks continue to affect investor decisions. Mismanaged electoral processes continue to aggravate this reality. A failure within the highest political leaderships (both government and opposition) to use institutions like the two houses of parliament as the forum for political debate magnifies the risk of a future mass exit from democracy itself. The young and angry could vote with their feet and arms. And yet another elite compromise that does not address the status quo might be the spark to light the unforgettable fire.
