Nelson Mandela once said: “Money won’t create success, the freedom to make it will.”
Since the day it became official that the Kenyan economy was larger than we previously thought, there have been many commentaries. Most are cynical about the fact that Kenya is richer while the fact on the ground is that many people are poor.
Indeed even in developed countries there is poverty within the riches and the secret of success lies in the people’s ability to see opportunity and seize it.
Our continued cynicism does not help the masses. One way or another, Kenya was going to pass the threshold of lower-income countries that have preferential treatment in trade from developed countries and cheap loans from the Bretton Woods institutions.
The move to middle-income status is akin to a young man moving out of his parents’ home to start fending for his own family.
Although he may go back to the parents from time to time, there will be no preferential treatment in taking care of his debts or business dealings. He simply has the freedom to learn how to survive in a competitive environment and sometimes make mistakes.
Similarly, Kenya is in a situation where she must manage her resources, market herself to attract foreign direct investments, negotiate favourable trade agreements with highly experienced countries and practically take charge of her destiny.
Of greater importance, she must carefully learn from Ghana’s fiscal indiscipline. Ghana has made fundamental mistakes and is today back on IMF bailout that could force the country to go through another phase of hardships while they try to meet strict conditionals to restore fiscal discipline and macroeconomic stability.
It is like that young man who moved out but he is not capable of balancing expenditure and revenues to the extent that the landlord wants him out of the rented house.
There are great opportunities that come with middle-income status but unless we seize them, we may just be grumblers throughout our short lives on earth.
Signs of Kenya in the middle class are here with us. Just walk into retail stores that are popping up at the many mushrooming malls in the country. They are like a bee hive of people.
On a two-kilometre stretch of Ngong Road there are more than six mega stores with thousands of customers. Thika, Limuru and Jogoo roads, and Karen, too, are teeming with malls and mega stores.
Foreign supermarkets such as Carrefour have booked space in two giant malls, that is, the Hub in Karen and Two Rivers on Limuru Road. The question we need to ask ourselves is, where are the opportunities in all this?
The rise in consumption is a boon for farmers. And for farmers to benefit, we must understand what the consumer needs, the value chain of such needs, and provide that knowledge to the farmer. We must breach this knowledge gap.
Let me elaborate further. Inasmuch as a foreign direct investor like Kentucky Fried Chicken would want to source for inputs locally, the standards required are simply not available here.
The farmer must access that knowledge and stop growing useless potatoes whose purpose is to discourage youth from getting into farming due to lack of markets. There is, therefore, abundant opportunity in knowledgeable agriculture. We may need new legislation to require investors to source at least 40 per cent of their inputs locally.
We must quickly develop the capacity and the tenacity to negotiate for our country and Africa. But more importantly create greater transparency in negotiations such that the general citizen can provide input.
The ongoing Economic Partnership Agreement (EPA) between European Union (EU) negotiations with Africa, Caribbean and Pacific (ACP) regions have been unnecessarily opaque yet the EU publishes such negotiations publicly to its citizens.
The negotiations are aimed at promoting trade between the two groupings – and through trade development, sustainable growth and poverty reduction to help ACP countries integrate into the world economy and share in the opportunities offered by globalisation.
But even though these agreements have been going on for well over 30 years, we failed in spite of the generous access to the European market.
In summary, preferential access failed to boost local economies and stimulate growth in ACP countries. And the proportion of EU imports from ACP countries dropped from seven per cent to three per cent of EU imports, says a EU report.
What will free us from poverty is not just money in people’s pockets but the knowledge and discipline to make that money.
The writer is a senior lecturer, University of Nairobi and a former Permanent Secretary, Ministry of Information and Communication