MY REMARKS ON THE TRUE STATE OF THE NATION
STILL RUNNING ON PROMISES: THREE YEARS OF JUBILEE:
STATE OF THE NATION ADDRESS BY THE COALITION FOR REFORMS AND DEMOCRACY:
Three years ago today, President Uhuru Kenyatta presented a glittering picture of what his administration was out to achieve to make better the lives of then immensely expectant Kenyans.
Last week, the President kept to the tradition of glitter and presented what in his view is the perfect state of the Kenyan nation in which everything is running well and smoothly.
Today, we go beneath this false glitter and share with you fellow Kenyans the rot, the lies Kenyans are being fed and the failure that is trailing the nation and which Jubilee continues to deny.
Since 2013, everything that can go bad has gone bad. The happily ever after image that Jubilee is trying to portray is a plain lie.
COST OF LIVING:
The first surprise to hit Kenyans within the first three months of Jubilee coming to power was the sharp rise in the cost of basic goods and services. By September 2013, the prices of most consumer goods had shot up by at least Sh7. Depending on the manufacturer; the price of processed milk ranged between Sh50 and Sh56, up from Sh45. Prices of phones went up by 16 per cent. This was as a result of the increased VAT charges. It has affected bus fare and rent. Today, Kenyans spend more than half of their earnings on basic needs such as food, housing and clothing, leaving them with very little to save and invest in business. Expenditure on food takes the lion’s share of household budget at 47.4 per cent.
Jubilee rightly picked food security as a national priority. It promised to put 1 million acres under irrigated agriculture. The first step to turn this promise into reality was the Galana Irrigation Project in Tana River. That project is now officially a scandal and a subject of investigation.
The irrigation project was launched prematurely without a feasibility study. Kari advised that more time be allowed for soil tests to determine what could grow on the farm. Experts questioned the economic viability of growing maize under irrigation. But Jubilee was keen to be seen to be doing something and went on a launching spree. In the end, the project produced only 10 bags rather than the targeted 40 bags of 90kg per acre. After about Ksh7 billion sunk into it, the 1 million acre food security project is now a failure and a mirage that has been recommended for investigation by the struggling Ethics and Anti-Corruption Commission.
Jubilee has failed to promote an innovative, commercially oriented, and modern agricultural sector. Failures in the policy and institutional framework have brought the tea, coffee, sugar, cereals and pyrethrum sectors to their knees. The Sugar sector has the added challenge of coping with an ill-advised trade deal with Uganda that exposes Kenya’s markets to flooding by cheap imported sugar.
Jubilee promised to improve the rail network in the country, including links with major cities. It also promised to implement and actualize the LAPSSET in addition to constructing a series of commuter railway networks in all major cities in Kenya. It promised to upgrade the Jomo Kenyatta International airport to a regional hub in addition to expanding and modernizing existing international airports in Kisumu, Mombasa and Eldoret.
Today the only rail infrastructure project that Jubilee has to show is the one it did not start; the Standard Gauge Railway. The only thing it has done to the rail project is to increase its cost. First, it was Ksh220 billion, which rose to Ksh327 billion after CRBC was allowed to include locomotives, passenger cabins and wagons. The cost later rose to Ksh447 billion to cater for land acquisition, loan insurance and loan processing fees. To this, Kenyans will add another Ksh150 billion for the newly conceived Nairobi-Naivasha line, which has become more expensive than the Nairobi-Mombasa line.
In his State of the Nation address, President Uhuru Kenyatta said the government has constructed 3,000 kilometres of roads in the last three years. This was a cold-hearted lie.
The government constructed no single road in the last two years. It spent those two years pursuing some Ksh260 billion ($2.48 billion) from local banks to construct 10,000 kilometres of tarmac roads in three years under an Annuity program. That program hit a dead end when commercial banks refused to fund the project that had been termed as one of the key milestones of the ruling Jubilee administration. Would be lenders disagreed with the government on the rate of interest to be charged on loans issued to contractors. That disagreement also resulted from Jubilee’s failure to manage the economy.
And so we challenge the President to show Kenyans the 3000 kilometres of roads it has constructed in the last three years by category and region; what class of road, from where to where? The President cannot take routine and periodic maintenance of roads; including the gravelling the earth roads, pothole patching, bush clearing and drainage clearance and report it as an achievement.
We challenge the President to give Kenyans a breakdown of the GoK funding as budgeted by stating which roads were earmarked for development in FY 2013/2014, FY 2015/2016 and now FY 2016/2017, how much was spent and when they got completed.
(iii) Lapsset Project:
This project is clearly in jeopardy; a combined result of Jubilee’s failing economic diplomacy and Kenya’s diminishing clout in the region.
(iv) Konza ICT City.
President Mwai Kibaki laid the foundation stone for this project that was to be a modern information and communication technology centre at Konza. For all intents and purposes and despite Jubilee’s self declared digital inclination, this project is now dead.
Jubilee has changed the story on its pledge to generate additional 5,000 megawatts (MW) of power by 2017. Jubilee is 99 per cent off the target just 16 months to the next General Elections.
The government has pumped only 675 megawatts since it assumed power in April 2013. The President;s delivery unity recently revised the narrative to say the overall vision of taking our generation capacity to 5,000MW remains but it is highly unlikely we will get to 5,000MW by 2017. We trust Jubilee at our own peril.
WITHER NAIROBI THE REGIONAL HUB:
The Jubilee regime has undermined and more or less killed the possibility of ensuring Nairobi continues to be the regional business and travel hub in Africa. The cancellation of the Greenfield Nairobi airport will deny Kenyans strategic expansion and kill our competitiveness. Further, the cancellation at a minimum will cost Kenya taxpayers Ksh15 billion.
These costs many further rise to unknown figures if the Government is taken to court for breach of contract.
CORRUPTION AND FINANCIAL MANAGEMENT:
Jubilee pledged to make public procurement regime open, transparent and corruption-free in order to ensure that all deserving young entrepreneurs have the opportunity to secure government tenders. IFMIS was to be at the centre of this would-be revolution. For a moment, all looked well. The National Treasury facilitated connectivity of the 47 counties to the IFMIS system. Technical and functional teams were sent to the counties to provide support and train throughout the year. Then the NYS scandal happened and IFMIS itself became a fraud. The Ksh791 million NYS scam was executed well within the auspices of IFMIS. Eurobond funds have been stolen with IFMIS firmly in place.
Under Jubilee, with IFMIS in place, the country has witnessed more procurement related fraud and appeals than at any time in our history. It has delayed critical projects, killed some and substantially raised the cost of many others.
Under Jubilee, despite the tough talk, corruption has become our second name. This year, Kenya was once again ranked among the most corrupt countries in the world. The newest Transparency International report ranked Kenya at position 139 out of 168 countries. Kenya retained the same score, 25 points out of a possible 100, it had in 2014. Corruption continues to raise the cost of infrastructure development in our country while siphoning off scarce resources that could improve the lives of our people. Some surveys show that corruption in Kenya costs local firms 6% of their revenues. Kenyan youths lose over 250,000 jobs annually due to corruption. The struggle against corruption is one of the great struggles of our time.
OVERALL STATE OF OUR ECONOMY:
Vision 2030, which is anchored on the Three Pillars of Economic Social and Political Development and Seven Priority sectors, seeks to transform the country into a rapidly industrializing, middle-income country providing a high quality of life to all citizens in a clean and secure environment. These lofty goals would be achieved by attaining and maintaining 10% Economic annual Growth by 2012, and sustaining that rate of growth from 2013 till 2030.
Jubilee Administration has failed to attain the most important target under the Nation’s Economic Blueprint. It’s plain for all to see that Annual economic growth at 5.4% in 2013, 5.2% in 2014 and 5.7% in 2015 is well below the nation’s overarching economic target. We are nowhere near the double-digit growth that Jubilee promised.
Jubilee has failed to deliver a robust, diversified, and competitive manufacturing sector by failing to implement the Special Economic Zones (SEZ) and Free Trade Areas (FTAs) as planned under Vision 2030 in Mombasa, Lamu and Kisumu.
WHOLESALE AND RETAIL SECTOR.
Kenya’s large informal and SME sector has not benefited from programs and policies to formalise the sector and transform it into an efficient, innovative sector with a diversified product range.
The UWEZO Fund, the Youth Enterprise Fund and Women’s Enterprise Fund have all become part of the Jubilee failed programs. Many policies and programs simply collapsed under the weight of rampant corruption unleashed by the Jubilee Administration.
Tourism is one of the nation’s key export earners. The Jubilee Administration has presided over its total collapse.
The President said all is well with tourism. Yet the number of Tourists visiting Kenya has dropped from 1.8 million in 2013 to barely 1.0 million in 2015. Tourist Resort Cities in that were to be started in Mombasa, Lamu, Isiolo and Turkana have effectively been abandoned by the Administration. Over 10,000 workers have been laid off in the Coast hotels over the last two months.
FINANCIAL SERVICES SECTOR.
Kenya has a relatively well-developed Financial Services sector, with a vibrant banking and capital markets. But collapse looms large.
We see wholesale failure and neglect by the Jubilee Administration in this critical sector, which has systemic impacts on the economy. The on-going turbulence with collapse of banks creeping in again point to a crisis whose consequences will be felt long after the banks have been shut. The fact that the Central Bank of Kenya today has no Board of Directors speaks volumes about the commitment of the government to prudent financial management.