Sunday, July 21, 2013

Kenya’s Economic Growth Path is Defective


According to the World Bank, Kenya's economy will grow an estimated 5.7 percent in 2013 before accelerating to 6% in 2014. This is on the back of impressive, unprecedented growth over the past decade. Despite projections of considerable economic growth and increasing self-confidence as a major regional economic player, millions of lives are wrecked daily by poverty, malnutrition and by pitiable public investment in health and education services.

About 44% or 2 out of every 5 Kenyans live in conditions of extreme poverty, subsisting on less than Ksh.105 a day. These Kenyans spend 50-80% of their income on food and are sinking deeper into a poverty trap triggered by hunger. According to the World Health Organization, around 35% of children under five in Kenya are stunted through malnutrition, with food insecurity widespread in many rural parts of the country.

A food security, vulnerability and nutrition assessment conducted by the government of Kenya in 2010 revealed that more than 25% of urban children were stunted while 13% of urban households had unacceptably low levels of food consumption. In May 2012, the government distributed 4,800 bags of rice and soya and another 400 tins of cooking oil to poor households Nairobi, where it was estimated that 65% were food insecure.

Only 4% of Kenya’s 75% rural population has access to electricity. Wood, charcoal, dung and crop residue supply 76% of Kenya’s domestic energy needs. There is a strong correlation between exposure to biomass fuel and respiratory infections in children. A report published by the Ministry of Health in 2004 revealed that acute respiratory infections contribute to 70% of mortality in children less than 5 years of age.

A report by Uwezo, an education advocacy group, revealed that among standard 3 pupils only 28% from the poorest households had achieved expected numeracy and literacy, compared to 48% in the richest households among grade 3 pupils. 25% of the over 800,000 children who finished primary school in 2102 will not transition to high school. The path to gaining skills and competing in a knowledge economy does not exist for a majority of our children.

According to the 2009 census, only 2 million of 14.5 million Kenyans in employment have stable jobs, which pay a living wage. 12.5 million Kenyans are employed in sectors that are highly vulnerable and do not pay enough to lift our fellow citizens out of poverty. Inequality is staggering; the richest 10% of households spent on average 14.3 times more than the poorest 10% of households in 2011.

The impressive growth of the last decade has not trickled down. Kenya’s overriding preoccupation with economic growth makes no sense without recognizing that sustained gains in human welfare depend on how that wealth is created and distributed. Our economy, which is largely driven by services, has the least potential to generate a broad based shared GDP growth for a population dominated by unskilled school dropouts and struggling smallholder and pastoralists. In a sense, Kenya’s growth path is highly defective and exacerbates inequality.

This path of inequitable growth will have serious implications for political and socio-economic development, undermining the tenuous foundations of our young democracy. GDP growth without investment in human development is unsustainable and unethical. What is the purpose of a growth path that produces handful billionaires, luxury shopping malls and superhighways rather than access to water and sanitation, high quality education for our children, better nutrition and security for millions of Kenyans?

We must learn from China, where massive investment in expansion of education and healthcare in the 1970s is paying off and has proved critical to undergirding China’s sustained economic growth. Without comparable investments in laying such a foundation, Kenya’s economic growth will remain modest and vulnerable.

We must make public investments, which will give the vast majority of our fellow citizens a toehold on the first rung of the ladder out of poverty. These include support to smallholder farmers and pastoralists, affordable public transport such as bus rapid transit, affordable mixed–income housing in urban areas and vocational training and work readiness for recent graduates.

What holds Kenya back is not the quality of our air or soils or water but successive governments, which lack clear-headed, long-term policies and the political will to follow through. We must ask and demand more of our government and ourselves. Most of all, our collective conscience must be stirred because when our conscience quickens political action will follow. 

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