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Entrepreneur's Corner

Kenyan Economy in Recession as PR on Performance Goes into Overdrive

BY Steve Biko Wafula · November 1, 2016 01:11 pm

Most of us have a difficult time deciphering the business language that our journalists throw at us. We don’t understand how the markets work. We don’t get how the trading at the NSE is done. We don’t comprehend what the numbers mean when institutions like World Bank tell us that by 2018, our economy will be growing by 6.3%. Most of are okay being guided and led and ruled under the guise of ignorance bliss as we struggle to pay bills, pay debts, meet our financial obligations.

World Bank, Bloomberg have praised Kenya as the beacon of hope in sub-Saharan Africa in terms of economic growth and trade balance. The numbers have been shared. The projections have been done and everyone is happy. Everyone here meaning those in leadership with a 7-figure salary. As an entrepreneur with over 10 employees, my views and perceptions are somehow different from the rosy picture being painted.

Most will think I am anti-jubilee. Many will say I have been bought by CORD but the truth is, I am suffering like I have no other means of growth or survival. If then, my status is tough, what about the rest of us? What about my staff? I belong to a group of local entrepreneurs, where we number over 5000 and I am the only one who has not yet laid off anyone. Its tough out there but they say the numbers are good and our economy is doing very well.

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There are eight indicators that economists’ world over use to measure the stability of the economy and see if its growing or not. In Kenya, we seen to depend on World Bank, IMF and Bloomberg to tell us what’s happening instead of looking at the critical numbers collected by the KNBS. I would trust KNBS over any other institution when it comes to data on our economy and this is something that our dear government needs to look at.

GDP measures the level of economic activity within an economy of a country and from a Kenya’s perspective, the only key economic activity is the high import of steel for the SGR, mega scandals and key brands shutting down. We have over 30 brands that have laid off staff and more in the process of doing so to reduce costs of operations, consolidate in order to compete better, and some have fallen by the wayside due to slowness to adapt to the fast-changing technological advancement.

We are creating jobs via gambling firms while real brands in manufacturing and agriculture are shutting down or relocating. Is our economy well? Is it sound? Our debt levels are extremely high and unsustainable.

Examples of these brands that have led to over 25,000 loss of high end jobs in the last 4 years are;