Kenya’s Ailing Economy: Man Eat Man Dynasty Choking Her To The Grave

Currently, Venezuela is the only nation in the world with the highest inflation rate of 10,000,000 percent.

The situation in Venezuela is so bad that the Central Bank of Venezuela asked citizens who needed money to go with their own printing paper so that the currency can be printed on it.

In Venezuela right now, their own money has no value. They cannot afford to buy anything. The unemployment rate is hitting 90 percent, people are desperate and have lost hope.

The economic tribulations facing Venezuela started like a joke coupled with weak and unfounded economic policies, poor leadership and an inability to sustain her population economically.

In the end, the inflation rate shot to 10,000,000 percent, unemployment rate to 90 percent, poverty levels to unimaginable levels and if nothing will be done, the situation will be worse than it was for Greece.

What is happening in Venezuela would soon happen in Kenya. I know this sounds like a joke but tough times are on the way and soon, people will face reality and there will be nowhere to run to.

Kenya is a “man eat man” society where those in power are both angry and hungry to devour anything public on their way leaving the common with nothing to hold on.

The current crop of leaders in Kenya seems to be aloof of the state of the economy. They seem to have completely refused to face the reality and instead choosing to hide behind cooked numbers that do not resonate with the common man on the ground.

Also Read:

• Venezuela’s Inflation To Hit 1,000,000 Percent By End of 2018
• Uruguay Issues Travel Advisory Against The United States

Corruption

In Kenya, corruption seems to be the order of the day. It is like corruption is deeply embedded within the DNA of any public servant.

The rate at which public funds are being looted from Kenya is alarming and soon, there will be nothing to loot, nothing to eat.

Someone said that the poor in Kenya will soon have nothing to eat but the rich. Those given an opportunity to serve are only concentrating on accumulating wealth. Nothing about the people.

Kenya loses approximately 1 trillion shillings every financial year to corruption. In other words, the country is losing a third of its budget to corruption.

Every time they say that the national budget is 3.6 trillion shillings, subtract 1 trillion shillings that are budgeted for corruption. We are in a country of thieves.

Other countries have the Mafia but in Kenya, the Mafia have the country.

According to the former Chief Justice of Kenya, Dr. Willy Muntunga, “The influence of cartels in Kenya is overwhelming. They are doing illegal business with politicians. If we do not fight the cartels, we become their slaves. But leaders who take on the cartels must be prepared to be killed or exiled.”

Corruption scandals have amounted to a total of 6,652,459,800,000 shillings since 2013 under President Uhuru’s governance, according to Corruption Tracker.

When the Jubilee administration came into power in 2014, Kenyans had so much hope and expectations from the administration as they depicted a breath of fresh air in the political scene.

However, corruption scandals and misuse of public funds started in the first term of Uhuru’s presidency and have continued to occur up to date.

Also Read:

• 6.6 Trillion Shillings Looted as Corruption Balloons in Kenya
• Saccos, the New Corruption Vehicles Propelling Greedy People to Instant Riches
• Kenya Loses Ksh.1 Trillion Every Year to Corruption – What Could 6 Trillion Stolen So Far in Jubilee Government Do?

Inflation and the unemployment rate in Kenya

Both the inflation rate and the unemployment rate are rising at the same time and almost at the same rate in Kenya.

The inflation rate for the month of July stood at 6.3 percent from 5.7 percent in June and experts say the rate is expected to go up.

Among the things that are pushing the inflation rate up include the increasing fuel prices as well as the price of foodstuffs such as maize and maize flour.

The price of a 90-kilogram bag of dry maize is averagely retailing between 4,000 and 4,500 shillings across the country, making Ugali, a staple meal for many households a luxury.

The price of a 2-kilogram packet of maize flour has increased by more than 38 percent to retail between 120 and 135 shillings from between 84 and 86 shillings.

The unemployment rate, on the other hand, is almost reaching catastrophic levels. According to an official from the National Employment Authority (NEA), the unemployment rate is at 43.5 percent but the “government doesn’t want to make it public.”

To make matters worse, companies in Kenya are laying off staff en masse. A week ago, four companies announced the laying off of more than 1,700 employees.

The East African Portland Cement which has been making a loss of 8 million shillings per day announced that it would be firing 100 percent of its workforce.

East African Breweries Limited is planning to retrench 100 employees in Kenya, Telkom is letting go 72 percent of its workforce (575 employees), while the Stanbic Bank is letting go 200 more employees.

According to the survey by the Kenya Association of Manufacturers (KAM), out of about 1,000 manufacturers in Kenya, only 240  are planning to take in employees while 330 of them are planning to fire employees.

Stats show that 70 to 80 percent of Kenyan youth are without meaningful employment. This means that currently, 7 to 8 in 10 youths in Kenya has no job.

Most of the unemployed youth have what it takes in terms of academic qualifications from institutions of higher learning such as universities.

More than 40,000 people graduate from institutions of higher learning in Kenya annually. The Kenyan job market is already saturated with the absorption rate in the white-collar sector being less than 3 percent.

In the end, there will be no jobs created but more job losses which are likely to create an unemployment crisis. Former Prime Minister Raila Odinga recently said that the unemployment among the youth in Kenya is a time bomb that will soon go off. He is right.

Economic analysts say Kenya will soon be in a state of stagflation; persistent high inflation combined with high unemployment and stagnant demand in a country’s economy.

On paper, especially in stats released by the Kenya National Bureau of Statistics (KNBS), the economy is doing well, in fact, at 6.3 percent but in reality, the economy is stagnant.

GDP stats show that the economy is slowing down. People are not getting hold of cash hence reducing the ability to purchase goods and services.

Also Read:

• Kenya’s Unemployment Rate Hits 43.5 Percent
• Kenya Eyes E-Commerce Platforms to Curb High Unemployment Rates

Imbalanced trade with other countries

Kenya is producing what she can’t consume and consuming what she can’t produce leading to a trade imbalance with other countries.

For the first time in Kenya’s history, we bought more goods from African countries than what we sold to them.

According to Trading Economics, Kenya’s trade deficit narrowed to 108.4 billion shillings in May 2019 from 112.7 billion shillings in the corresponding month.

During the same month, exports slumped 16 percent to 0.464 billion shillings with imports slightly falling to 154.9 billion shillings.

The balance of trade in Kenya by May 2019 averaged -44747 million shillings from 1998 until 2019.

Kenyans buy more than what she sells with our only major exports being horticultural products and tea.

Kenya is an agricultural country. With this in mind, we are not supposed to be importing foodstuffs but look at us, we are importing even maize.

The food situation in the country is likely to get worse as many farmers are increasingly abandoning growing of maize due to poor prices from the National Cereals and Produce Board.

For Kenya to balance her trade with other countries, local industries in the manufacturing sector should be supported. Otherwise, the Big 4 Agenda will just be another Big 4 Hoax.

The ailing SME sector

The SME sector in Kenya is the backbone of the economy. The sector employs 86 percent of Kenyans and contributes to more than 45.6 percent of GDP.

The cost of doing business in Kenya is so high that the SMEs are being choked to death with those that cannot withstand being faced off the surface.

More than 1000 SMEs are closing down in Kenya daily due to among other things inadequate access to funds as well as the unfriendly business environment that has been brought about by poor government policies.

The SME sector in Kenya is one of the most taxed. “These taxes touch on various key sectors of industry, and are bound to have a negative bearing on Foreign Direct Investment, the size, and productivity of local industry,” said KAM in a statement.

Our leaders SHOULD WAKE UP.