Presidents, like other employees, sign up for specific work and results. Their employers, the citizens, must appraise presidents and other politicians to determine whether they performed as agreed in their contract.
President Uhuru Kenyatta exits office in less than a month, and it is an opportune time to determine if he met, exceeded or fell short of the expectations of Kenyans.
Legacies are best judged in historical terms as the effluxion of time juxtaposes performance against the legacies of others of equal station, allows for context, and makes trends ever so clear to enable objective judgement. However, a preliminary performance assessment of President Kenyatta is ideal now as we focus on hard facts that are immutable.
President Kenyatta signed up to transform Kenya. In his first term, some of the memorable promises he and his deputy, William Ruto, made were giving laptops to all children in primary schools, massive improvement in access to water and healthcare, as well as a huge expansion in infrastructure.
Many of these promises were not kept. Some of them, such as increased supply of electricity to schools and villages were partially achieved, detracted by excessive costs to consumers and outages.
In his second term, the President was more focused, cringing from the exacting demands of Kenyans and the opposition for him to show results, often citing the non-existent sports facilities, and aging children that had yet to touch a laptop, let alone own one.
The ‘Big Four’ agenda was a commitment by Uhuru to ensure his administration transforms the economy between 2017 and 2022. It is commendable that he put clear performance indicators in the Big Four commitments, which can be measured objectively from credible government survey and administrative data.
In a series of articles, I will analyse the performance of the Uhuru administration in its efforts to achieve the Big Four commitments to Kenyans — manufacturing revival, affordable housing, universal health coverage, as well as full food and nutrition security.
In this first article, I will discuss manufacturing and the industrial revival it was supposed to spur.
President Kenyatta committed to galvanise manufacturing with policies to encourage value addition resulting in increased manufacture of textiles, oil, steel, food, and electronics. The result would be manufacturing share of nominal GDP doubling to 15 per cent, a revival that would facilitate creation of one million new jobs.
Although manufacturing output and value added grew in the material period, the Economic Survey of the Kenya National Bureau of Statistics shows that, as a share of nominal GDP, manufacturing declined from 8.7 per cent in 2017 to 7.2 per cent in 2021, a decrease that started before the Covid-19 pandemic.
This implies that much of the growth in national output is increasingly from agricultural primary production and the services sector, which are dominated by informal and precarious low-wage employment.
However, sub-sector analysis shows there was a huge expansion in sugar milling and motor vehicle assembly, nearly doubling between 2017 and 2021. Finished leather output increased by 31 per cent in 2021 compared to a year earlier. Shoe production registered significant growth. Output of cement and wood products increased substantially.
Employment in manufacturing barely budged, standing at a mere 338,000 persons in 2021, a far cry from the one million new jobs promised in the Big Four commitment. Inadequate manufacturing jobs, as well as onerous licensing and taxation of informal businesses has kept incomes of self-employed people and informal workers low, and most of them have no social security, making their lives precarious.
About 15.3 million Kenyans, or 83 per cent of total employment outside small-scale agriculture and pastoralist activities, are informal employees or self-employed and this proportion has stayed the same during the Uhuru administration.
Whereas this is a huge opportunity as most economies, even advanced ones, rely on small businesses to prosper, this large number of Kenyans in precarious informal employment due to low incomes, lack of health and disability insurance and inadequate old age pensions makes the situation untenable.
For example, the National Social Security Fund had only 406,690 new members in 2021, a decline from 584,390 recorded in 2017. Private pension schemes had about one million members at the end of 2021.
Overall, the FinAccess survey by the Central Bank of Kenya and KNBS shows only 10.6 per cent of the adult population, some 2.9 million people had an active pension and NSSF account in 2021.
An overwhelming 89.4 per cent, about 24.5 million working and retired people had no pensions for old age. Over one million people are aged 70 years or over, and it is commendable that the government assisted 757,744 of them in 2021 with cash transfers of Sh2,000 per month. However, the cash transfer amount is inadequate compared to household consumption needs. This is a disastrous situation that calls for urgent reforms to ensure most people have jobs, earn enough for living expenses, save, and contribute for disability, health and pensions needs.
There is no doubt that Kenya has a comparative advantage in production of certain agricultural, mineral, fish, and other products. Kenya is blessed with a huge youthful population that can work. These advantages make manufacture of textiles, processed tea, coffee and horticulture, fish products, electrical cables, chemicals, and construction materials, among others, viable industries. Instead, growth in these sub-sectors has been lethargic.
Textile production has an enormous potential for employment creation, from farms of cotton and other raw materials, to manufacture of clothing and accessories that can compete in domestic and export markets. Many wealthy nations have low tariffs and no significant barriers for sale of Kenyan textiles.
I was happy to see some Kenyan clothes on the racks of Walmart Supermarkets on a recent trip to the US. Labour costs in Asia, the main producers of textiles in the world are rising inexorably, increasing Kenyan competitiveness that can attract manufacturers, if skills of workers are improved, sufficient regulatory incentives are established, and the corruption that makes doing business in Kenya expensive eliminated.
Presidential candidates in the forthcoming election have proposed some solutions to the problem of manufacturing output and unemployment. Notably, former Prime Minister Raila Odinga has recognised the immense potential to turn Kenya into a manufacturing powerhouse, proposing policies to facilitate leveraging of value addition to create more jobs through increased productivity in agriculture, mining, and fishing. This will supply raw materials for intermediate and final manufacture in Kenya of textiles, beverages, leather, apparel accessories, and chemicals, among others.
The manifesto proposal by DP Ruto to create a fund of Sh50 billion per year to support growth of small businesses is laudable. However, this amount is puny because there are more than 15 million people self-employed, or working in informal businesses in Kenya. Ruto and his team should elaborate the impact of such a policy on jobs and incomes, as well as plans on manufacturing.
In a nutshell, the legacy of Uhuru Kenyatta on manufacturing is a mixed bag. On the one hand, improved output in certain sub-sectors drove manufacturing value up from Sh2.1 trillion in 2017 to Sh2.7 trillion in 2021. On the other hand, manufacturing employment and value addition stagnated and fell short of the Big Four target.
This gives an apt opportunity to the next President to implement policies that leverage the competitive advantage of Kenya to increase manufacturing massively and create millions of jobs here at home.
Sisule is a policy analyst based in Geneva, Switzerland. These are his personal views.
