Heed BBI, work towards stronger economy

A new year is here and with it a new decade. During the 2010s, Kenya not only experienced a lot of turmoil but it also registered a great deal of positive change.

The year 2017 saw ethnic clashes over disputed presidential election results. Things, however, cooled down and a general state of peace and harmony was realised.

We suffered a spate of terrorist attacks over the past ten years, but the Kenya Defence Forces (KDF) stepped up military operations in Somalia while Kenya has assumed its role as the leader in counter-terrorism in all of East Africa. 

The March 9, 2018 famous handshake between Opposition leader Raila Odinga and President Uhuru Kenyatta put behind us not only the ill will between the two politicians, but a larger story of decades of animosity and competition over the national leadership.

It was fitting that the final months of the decade culminated in the publishing of the Building Bridges Initiative (BBI) report.

The document acknowledged our national problems/

At no moment in our nation’s history has the government facilitated such a wide scale process of introspection and self- reflection.

We should think as individuals how to make Kenya better, stronger, safer, and richer.

During the early months of 2020, it is important that we look back on the analyses that the BBI brought us and begin planning how we can work towards the goals that the report puts forth.

And the most important issue that will make or break it for us in the coming decade is the strength of our economy.

Money is the driver for everything in a modern society. It is the difference between a quality education and not being able to go to school.

It is the difference between sufficient healthcare services or being too sick to go to work or take care of the family.

It is behind infrastructure and subsequently the ability of farmers to trade their goods, and of merchants to import inexpensive products from abroad.

For this reason, the BBI taskforce has reaffirmed prosperity as a national goal of chief importance that we must strive towards not only during this decade, but for the next fifty years and beyond.

It suggests “to think big and long term.” Right now we have the opportunity to think about how to boost the economy during the next decade, but we can also plan for what we want to achieve at the beginning of 2030, 2040 and so on.

Recent reports from the World Bank have indicated that contrary to the beliefs held by some in our media, economic growth during the past year under President Kenyatta has actually been relatively strong, and further growth is projected in 2020. 

Last year, the economy grew at a rate of 5.9 percent and the World Bank predicts it will increase to 6 percent in the coming year.

This is likely due to increased industrial activity combined with the November decision to do away with the interest cap law.

As a result, the private sector has more access to credit, thereby making it easy for companies to grow.

According to the World Bank, the government has been able to maintain inflation within the target range (7.5 per cent), and the current account deficit is expected to remain at a manageable level.

To put things in perspective, growth in high income countries is expected to reduce to 1.4 per cent in the coming year, while in low income countries the rate is projected at 4.1per cent, significantly less than Kenya.

Development economists agree that highly developed economies should grow at a rate of about three per cent, and emerging markets at twice that - as Kenya is doing.

In Sub Saharan Africa growth is expected to be at around 2.9 per cent this year as long as growth continues in the oil and agriculture sectors.

Finally, the report predicted that growth in the US and Eurozone is also expected to drop.

When factoring in all of these considerations, our economy is in good shape, especially in comparison to others both within our region and beyond.

But we cannot be complacent and expect this positive slope to continue forever. 

The BBI has synthesised what has been known but not yet coherently vocalised - our economy will be strengthened more and more if the nation and the government are in sync.