• Kenya’s overwhelming debt burden, President Kenyatta’s ambitious Big Four Agenda likely to shape landscape.
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Along the streets of Nairobi, Migori, Nyeri or any county in Kenya, the citizens are baying for action and conviction of corrupt leaders, especially political leaders. Any glimmer of hope that a politician will be thrown behind bars excites the public and it is understandable given the mega corruptions that we have witnessed in the past. But going by what has happened in the recent past with high ranking public and state officers forced to step aside coupled with echoes of asset recovery, would be corrupt individuals must be weary. Looking back at President Uhuru Kenyatta’s last State of the Nation Address several things begin to make sense. One statement that rings the bell is the president’s decree that anyone arraigned in court would be asked to step aside. Seems like the President had all these figured out with a well-intentioned move to depoliticize the fight.
And then comes Justice Mumbi Ngugi’s ruling it becomes clear that even elected leaders, especially governors, are not sitting pretty. Infant, what is happening now portends a very bright space in fiscal management of public funds given that it is increasingly becoming clear that the focus is on asset recovery and to make it difficult for grand looters to enjoy what they have stolen or even straddle the corridors of power to bulldoze potential witnesses. It certainly appears that corruption suspects will not be bestriding the corridors of power and justice and get aways megastars like it has happened in the best when arraigning suspects has essentially glorified corruption. The tenacity and the smart way both the DPP and the DCI have stepped down from the blockbuster gusto to presenting suspects to the public without much fanfare seems to speak to the seriousness of this fight.
Kenya’s overwhelming debt burden, President Kenyatta’s ambitious Big Four Agenda and the dialectics of fiscal management against the backdrop of political turbulence within the Jubilee ruling party are likely to shape the economic landscape in Kenya. And it is increasingly clear that a concerted depoliticized fight against corruption holds the key to maintain the ruling coalition and funding the legacy projects.
In the wake of the Sh3.02 trillion budget and a taxation regime that is likely to deal a blow to the average Kenyan, the Big Four seems to be fairly secure in terms of budget appropriation with 14.6 per cent of the 2019/20 budget going to the President’s legacy projects. However, with a revenue target of Sh2.2 trillion, there are clear indications that the government will either raid the pockets of already struggling Kenyans or go for sovereign loans, yet again, but with a much more innovative system of fiscal management and reporting.
Raiding the pockets of Kenyans may prove overwhelmingly unpopular and would give the Jubilee Party members aligned to the Deputy President, William Ruto, ammunition to sustain their critical stance on the President and Opposition Chief Raila Odinga in their newfound handshake. In fact, any fiscal policy that hits the common citizenry hard is likely to attract a backlash from the Tangatanga movement that pundits aver is hellbent on building a populist momentum towards the 2022 general elections.
The silver lining is that the handshake provides an anchor for innovativeness in depoliticising any radical measures meant to address the fiscal challenges and debt obligations in 2019. I mean when you have ODM Chairman, Hon John Mbadi defending the Jubilee government you know that the real opposition within the ruling party is in check and as Kenyans would tell you mbeleikosawa. Therefore, the arrest and arraignment in court of key public figures including Kiambu Governor, Ferdinand Waititu, and the treasury top officials seems to be taking a fairly a less political trajectory.
Granted, a transparent fiscal system with mitigating measure to stop corruption speaks to the debt option. In fact, the sovereign debt option seems plausible given that as recently as May 2019 the Government secured USD 2.1 billion, dual-tranche Eurobond in London, United Kingdom. The response from investors came as a boost to Kenya’s economic policy management and prospects going forward. To this end, the government is likely to go for foreign debt and cut down on borrowing locally.
However, the crux herein is how the government is going to put this debt into investments whose returns are quick and have the largest latitude to provide an enabling environment for economic growth and an increase in revenue collection. This seems to be the surest way to reduce the debt service to revenue ratio.
The Controller of Budget’s red flag that Sh1.1 trillion will go into servicing debt calls on the government to work on reducing the ratio which stands at 33%. Interestingly the handshake, though anchored on shaky grounds, is poised to be a lot more innovative in instituting a prudent and more accountable fiscal management and framework that will address both fiscal challenges and debt obligations.
One remarkable measure adopted even at the expense of political populism within the Jubilee Party is to seal all the loopholes of corruption. The office of the Auditor General has put the figure stolen through grand corruption at approximately Sh1 trillion, an amount the same as what the Controller of Budget says the country needs to service its debts. Moreover, strides have been made in financial management and reporting with a collegial cabinet committee led by the powerful Interior CS, Fred Matiangi, charged with the responsibility of fiscal management of government projects.
But even as Kenyans fight against corruption unfolds, Kenyans are waiting for the climax when the big fish will be thrown behind bars and stolen assets recovered.