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September 25, 2018

US investors must look beyond the warm welcome

President Obama’s visit seems to have brought out an unusual degree of craziness, especially from minor, largely unknown political parties and the far more notorious, stupidly-aggressive-as-usual students.

From their noise, you’d think that the US president had popped over to officiate at gay Moonies-style mass weddings (I’m still waiting for the university lot to make good on their offer to take themselves out of the gene pool). We’ve also been treated to a new race to the bottom between Mr Sonko and Mr Kidero in which the latter took an unexpected lead by, in all seriousness, launching a gate. Let me just repeat this: a gate! But in contrast to that is the happy excitement that many of the Focus Group (aka friends and other Facebook friends) feel about the first black US president coming to their country.

For domestic politics, the visit is a boon, and not just because it signifies that after the aborted ICC trial, Mr Kenyatta has officially been invited back in from the cold, and is now being warmly embraced. For US foreign relations, this was always a bit awkward, not the least because the US had worked with (or tried to work with) Kenya in combating terrorism for many years.

For Kenya’s investment prospects and economic development, however, I don’t think that this will be a substantial change, despite all the excitement. Shouldn’t it put Kenya on the US map? I’m not sure. CNN ran a feature with the stupid tagline that the US president was traveling to the "hotbed of terrorism", which predictably sent every Kenyan on Twitter and their pet fish into rants. A waste of energy, since this is CNN,US ‑ half of the time, they misidentify African countries on the map. But this is also where many US Americans (not all Americans) obtain information. Obama’s visit will barely register with them and they are still stunned that Kenyans have phones and are on Twitter.

There are also some corporate heavyweights in town. But any US American CEO looking at Kenya – if the country has indeed been freshly brought to her or his attention – will not make substantial investment decisions based on a quickie visit and a conference. If you don’t sit down to do your homework, to understand the Kenyan market and the conditions you’d have to work in (and the sometimes peculiar Kenyan consumers), it will cost you, as it would pretty much anywhere in the world.

And if they are looking at Kenya seriously, they are still up against the Chinese who often take a slightly more, say, hands-on approach (and come with lower costs), and other competitors. And of course they are up against #KideroGrass: Not the actual grass, obviously (if it does grow in the end). But that grass is so symptomatic for how this (often amazing, often infuriating) city is run.

In the Nation, Charles Onyango Obbo offered a gentle explanation for Kidero Grass and the other quick fixes to Nairobi’s appearance: "Poor societies in Africa, and indeed other parts of the world, tend to behave this way. They only put on their best when an important visitor is coming to their home, town, or country. (…) it is important for poor people to find dignity in their circumstances. It is a way in which they signal that they have not surrendered when it comes to improving their lot."

Maybe. But in contrast to the people that Charles mentions, who have few alternative, Nairobi City does have alternatives. Nairobi – and the rest of Kenya – could be prudently, thoughtfully managed to the benefit of its citizens, with far less corruption, with far more thought given to the weakest in society (While, in fact, the homeless were chased away from a private, voluntary Westlands feeding programme). When the whirlwind of the visitors is gone, this is the reality of Nairobi, one that any foreign investor would have to face, too: that massive amounts of money were spent, often last minute, often wastefully, often thoughtlessly, on superficial improvements, not with concern for the people who live here. All the wonderful security will evaporate and the rains will flood the streets again, and Nairobi City Council in its current reincarnation will look for ways to harass and shake you down. All of this, in Nairobi, across the country, will be no different for any new US investor, and they will have to consider it carefully if it’s worth the effort.

In an article in the British Guardian, Dr Adekeye Adebajo argued that the trip would be the "ultimate show of the symbolic, rather than substantive, approach that has characterised Obama’s engagement with Africa" – mostly because the US president had been very absorbed with domestic, Middle Eastern issues and other non-African issues. This left little time for his father’s home continent: "He hosted the first US-Africa summit in Washington last August, but this was effectively a talking shop involving empty pledges. His Power Africa initiative promised electricity to 20 million Africans, but remains largely unfunded."

Attracting productive long-term investment requires more than grass planted days before a visit. Way more. The idealism and the excitement of the past few days will carry on for a bit longer. An then it’s back to normal unless Kenya makes some structural changes.

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