Socialites rebased the economy before release of official figures

Kenyans have been basking in the glory of their newly acquired middle-income status. It has taken effort to convince them that the Vision 2030 economic blueprint has not been achieved yet.

However, the director general of Vision 2030 secretariat Wainaina Gituro wrote that the rebasing is a positive step towards the achievement of the vision.

XN Iraki, an economist, argues that rebasing the GDP figures to reflect 25 per cent upward adjustment is like counting the money under your mattress and declaring it.

This reminded me of an old woman in Meru who was sick but the family didn’t have money to take her to hospital.

When her health worsened, the family organised a fundraiser and she was taken to hospital. While cleaning her house later, the family discovered more than Sh1 million hidden under her mattress.

The key lesson from this story is how lack of awareness by the family delayed her treatment.

This would have improved her living standards; her moneyed status would also mean that she was bankable.

This means that her investment grade would have been high and the family would have thought of getting health assistance first since ability to pay would not have been in question.

Similarly, Kenyan investment credentials will increase with rebasing, borrowing capacity will increase and Kenyans will have more bragging rights, which is a good feeling.

After my previous visit to Ghana, I had some questions whether Ghana’s economy is actually bigger than Kenya’s. The rebasing has seen Kenya overtake Ghana, answering my nagging question on size.

Apart from celebrating the “achievement” of Vision 2030, sixteen years ahead, Kenyans had varied reactions. One of my colleagues stated that socialites will actually increase. I concurred that socialites rebased the economy long before the bureau of statistics could crunch the numbers.

Quality of life

Some of them spend a lot of money to look good, and they are talking about it. Another opinion is related to the new sectors included in the economic data.

The fact that there is the intention by the Jubilee government to fund HIV infection prevention programmes for commercial sex workers in billions emerged.

It was not clear whether their contribution to the economy was considered in the rebased figures.

If it wasn’t considered then maybe that presents an opportunity for rebasing the numbers in future. It would be necessary to capture the contribution of the “oldest profession” to the economy.

Our estimates were based on a census survey of commercial sex workers that had about 140,000 respondents. If each of them earn about an average of Sh5,000 a week, this would amount to Sh36 billion a year which is close to one per cent of the new economic numbers.

In his article, Dr Wainaina suggested the need for change of attitude in order to achieve Vision 2030. One of my friends suggests how one can rebase their attitude.

The suggestion is that instead of saying one earns Sh20,000, one should state the same as 0.02 million.

Kenyans should be excited about the new economic status and the goodies it will bring while working for improved quality of life.

The writer is the marketing director of SBO Research. [email protected]; Twitter @bngahu.