Data from the Central Bank of Kenya showing that only 2.65 percent of Kenya’s 66.3 million bank accounts had more than Sh100,000 last year in savings and those earning more than Sh100,000 accounted for only 2.9 percent of the 2.7 million formal workers points to saddening income equality.
It means that the economic growth that the government has been reporting over the years has not translated into a better life for a majority of Kenyans who have remained poor.
The government must now come up with economic policies that will put money in low-income earners’ pockets.
We are not talking about handouts because these will not be sustainable. What the government should do is invest in productive sectors that will have impact on livelihoods.
For instance, investing in a thriving agro-based industry and reforming tea, maize, coffee, dairy, sugarcane, and fish sectors can help lift millions of Kenyans out of poverty.
Consider, for example, what the Sh500 billion, the estimated amount of money used to construct the standard gauge railway, have done to agribusiness. Not that channelling money towards infrastructure is wrong, but if such amounts of money are invested in agriculture, we will not struggle to get value for money as it has been with the new railway.
Let the government focus on industries that have long supply chains, meaning that more people will benefit. Take, for instance, a dairy farmer in Murang’a, for example.
Besides the direct earnings accruing to him from his cattle, his herdsman, the agro vet and the transporter taking the milk to the co-operative society will also earn money. So will the people working in a supermarket in Nairobi selling the milk.
The devolved system of government had raised hopes of addressing the economic imbalance, but nine years on, few private investors are in the counties.
With adequate domestic and foreign investment, agriculture — a devolved function — has the potential to be the single highest job creator and has a range of possibilities to improve incomes and spur development.