The public resentment over skyrocketing food prices and the high cost of living needs empirical intervention measures by the government of the day.
Delayed rains across many parts of the country have led to crop failure, drought and widespread food shortage. People are paying a devastating price for a climate crisis they have done nothing to create. Families are on the verge of starvation and malnutrition, with many facing the impossible choice between food, water and medicine, daily.
The purchasing power of urban poor and rural consumers is on a firm shrink. Hunger, massive loss of livestock and human deaths continue to be experienced in the counties of Baringo, Turkana, Isiolo, Garissa, Wajir, Kilifi, Marsabit, Tana River, Samburu, Mandera, Kitui and Makueni.
Many times general elections are usually characterised by declining economic activities and reduced investments as businesses and investors adopt a wait-and-see attitude in case of any election-related violence or unforeseen changes in government.
Election years do not usher in major policy reforms as legislators are more focused on polls than on policy changes. This means Kenyans must bear the status quo until at least the August elections are over.
With the high cost of living being experienced, prospects of rapid economic recovery for Kenya and a better quality of life remain grim. Mental pressures at family unit levels with cases of suicides, femicides and homicides are on rising as a result of the inability to meet the excess socioeconomic basic demands.
The shopping baskets of most Kenyans have become significantly smaller over the past two years. Between June 2020 and June 2021, Kenyan consumers paid eight per cent more for food and beverages, 14 per cent more for transport, and four per cent more for water, electricity and housing, according to data from the Kenya National Bureau of Statistics. Inflation hit a 23-month high (6.91 per cent) in September 2021.
The cost of living in Kenya has been increasing remarkably for the past 10 years. The prices of basic commodities, such as maize flour, sugar, cooking gas and petrol, have increased by more than 46 per cent since 2013, according to KNBS data. Surveys show that the prices of most commodities, including bread, tomatoes, rice, potatoes and meat, have been rising by between 16 and 53 per cent since 2011.
There exists a difference between living wage and minimum wage. Minimum wage is an amount set by law, whereas the living wage is determined by average costs to live; housing, medical, food and transport costs, among others. The minimum wage concept has failed; it has not kept pace with the rising cost of living, causing many Kenyans to live below the poverty levels.
The rising food prices have an adverse effect on the poor and agricultural development as a whole. Majority of Kenyans largely rely on agriculture for livelihood sustainability. The government needs to step in authoritatively and double its efforts in cushioning Kenyans against the sky-rocketing food, farm inputs and fuel prices.
The rising inflation is a result of a variety of factors, including policy failures, that have led to a significant rise in the cost of living. Additional and high rates of taxation, astronomical national debt, and endemic corruption have placed punitive financial strains on ordinary Kenyans. The current regime has not done enough to alleviate the burden.
The government’s borrowing spree has added an additional load on Kenyans. By the end of 2021, Kenya’s debt stood at nearly 70 per cent of GDP, up from 50 per cent at the end of 2015. China is Kenya’s largest bilateral creditor, accounting for 67 per cent of Kenya’s bilateral loans, mostly for infrastructure projects, up from 13 per cent in 2011. In 2021, multilateral debt accounted for 41 per cent of external loans, while bilateral debt accounted for 28 per cent.
Out of every dollar of taxpayers’ money, 57 cents go towards servicing the country’s burgeoning debt, according to data from the Central Bank of Kenya. Kenya’s public debt rose to Sh7.7 trillion, about $70 billion, last year – a 13-fold increase since 2000.
Unfortunately, much of the government revenue raised to service debts is lost to corruption, making the cost of doing business and living very high.
Job losses in the formal and informal sectors and business closures have increased the number of people with no or reduced income. By the end of 2020, Kenya had gained an additional 2 million new poor, according to the World Bank. This is significant because small and medium-sized businesses constitute 98 per cent of all businesses in Kenya. And they create 30 per cent of jobs annually and contribute nearly three per cent of GDP.
The government of the day should focus on making Kenyans’ lives a little easier by putting in place policies and intervention measures to cushion the population against food insecurity
Measures include the provision of emergency food assistance; adoption of food safety nets; food subsidies; cash transfer; food for work and food for training; school feeding programmes; adjustments in trade and tax policy measures; enhancement of agricultural production through agricultural input subsidies and increased administered prices for producers should be strengthened in the short-term approach.
Long-term mitigative measures that include investment in agricultural research; increased investment in key agricultural services; investment in local infrastructure; investment in rural financial services, markets and linkages; investment in teleprocessing; investment in food distribution systems and macro-economic policy management should be in consideration and in place, devoid of politicisation.
Key stakeholders in the food sector should continue to analyse food prices and related issues, and come up with strategies for early warning to avert the negative effects of high food prices in the future.
The relevant authorities need to put in place mechanisms to respond to early warning of disasters such as droughts and floods. There is a need to increase agricultural productivity. This requires the government to expedite the implementation processes for the various formulated policies.
KARI, the main agricultural research institution, adopted a value chain analysis framework. This is critical and bound to help identify who does what at what point of the value chain and who is likely to benefit or bear the costs of implementing the proposed interventions.
The identification of bottlenecks and addressing the same along the value chain will improve efficiency and increase output in the value chain, which may result in stabilising or reducing the food price crisis. This calls for various stakeholders engaged in agriculture and related activities to work together for better results.
Founder, Integrated Development Network
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