The recent threat by the Higher Education Loans Board to publish details of 85,000 defaulters owing Sh50 billion paints a picture of a system in dire need of salvaging.
The state corporation and thousands of Kenyan graduates are in this situation mainly due to lack of employment opportunities in the market. Helb beneficiaries are ideally supposed to pay back the principal amount they borrowed plus interest upon securing employment.
This, according to the institution, would allow other deserving students to access the loan. The country can, however, ease the unemployment burden by beefing up the manufacturing sector, a key pillar in President Uhuru Kenyatta’s Big Four agenda. According to the Kenya Association of Manufacturers, the sector currently contributes to 8.4 per cent of the country’s GDP, employing about 300,900 people directly and indirectly.
The government hopes to increase the sector’s contribution to 20 per cent by 2022 according to the Big Four agenda. Research by KAM points that a robust manufacturing sector in any country has the biggest potential to create employment opportunities in an economy.
This will contribute significantly to absorbing the thousands of graduates churned out of tertiary institutions each year, enabling them to fulfil their financial obligations to the lender. Threats to expose the defaulters will not suddenly help them get jobs. A manufacturing sector that is enabled to grow and thrive will have a multiplier effect in the economy leading to growth in both the formal and informal job sectors.
It will also save millions of youths resorting to the last option to survive the harsh economic environment by engaging in crime for a few shillings.
Nairobi
