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close this bookThe Courier N 130 Nov - Dec 1991 - Dossier: Oil - Reports: Kenya - The Comoros (EC Courier, 1991, 96 p.)
close this folderCountry reports
close this folderKenya - Democracy: winning the hearts and minds of wananchi
View the document(introduction...)
View the documentKANU, the ruing
View the documentGearing up for industrial take-off
View the documentMatching resources with the population
View the documentPressing ahead with refonns
View the documentProfile
View the documentEEC at the grassroots
View the documentFinancial cooperation between Kenya and the EEC

(introduction...)

Kenya has the distinction of being among the very few African countries which have maintained a parliamentary form of government since independence, though under a one-party state. Widely praised for that, this once enfant cheri of western democratic nations has, to the astonishment of the government, come under severe criticism in the past two years, not only for resisting the wave of political changes sweeping across Africa, ie the move towards multiparty democracy, but also for what many perceived as violations of human rights and infringements of press freedoms.

The Kenyan government’s initial reaction was one of indignation at what it saw as external meddling in its internal affairs. It had thought that democracy was being fully expressed in the country through the one-party system, which has been in place in nearly all of Kenya’s thirty years independence.

Kenya had the right, it said, to choose its own political system and not engage in copying alien models.

Although the campaign for multi-party politics had been on for some years in Kenya, the movement was not galvanised until the recent changes in Africa. Rallies and demonstrations were held last year and early this year until March when President Daniel arap Moi put an end to public debate on the issue and declared outright there was no question of multi-partyism in Kenya.

Veteran politician and one time vice-president Oginga Odinga, the government’s most vocal critic, attempted unsuccessfully to establish a political party, the National Democratic Party (NDP). His application to the High Court for registration was rejected as illegal, Kenya being a de jure one-party state. Four other prominent opponents, Raila Odinga, son of the former vice-president, lawyers James Orengo, Martha Njoka and Gitobu Imanyara, editor of the journal, Nairobi Law Monthly ran foul of the law in connection with the campaign for multi-party politics and were duly detained.

The concern in official circles was and still is that the campaign is being orchestrated by outside forces. They fear it could provoke social unrest and create a distraction to the government at a time when Kenya is embarking on its most ambitious economic development plan yet. But the reaction of the government in detaining campaigners and suppressing public debate only succeeded in creating the impression of a serious political crisis and of massive repression in Kenya, prompting calls in several western nations, particularly in the United States, for linkage of further economic aid to the country with progress on democracy and on human rights.

As the months go by, however, and observers take a more dispassionate view of the arguments, foreign criticisms of the authorities have diminished as the merits of the gaverament’s position and that of its opponents are weighed. The tendency now is to be more neutral and to say that it is up to Kenyans to choose their own political system.

The argument

The Kenyan government opposes multi-party democracy on the ground that it encourages tribalism and therefore is disuniting. Its opponents which include lawyers, clergymen and politicians, many of whom are former members of the ruling party, KANU (Kenya African National Union) believe otherwise, seeing multipartyism as the best guarantee of clean government, of accountability and respect for human rights, as well as being the best guarantor of the rights of minorities - a bulwark against tribal domination and corruption. Grouped under a ‘pro-democracy’ movement, they have in recent months stepped up their campaign, by openly calling on donors to suspend aid to Kenya until multi-party politics are restored.

Laudable and courageous as the movement’s campaign may be in the eyes of many, it faces an uphill struggle both in convincing western governments to cut off aid and in winning the support of wananchi (the people). History and events recently around the world have shown that only the people can effectively bring about internal change. There is little outsiders can do.

Kenyans being generally apathetic to politics and much more concerned with their economic wellbeing, winning the hearts and minds of the people will not be easy. That task is made doubly difficult by the fact that, with the peace and stability the country has enjoyed over the years at the back of their minds, the political turmoil that has embroiled Kenya’s neighbours (Uganda, Ethiopia and Somalia) not to mention further afield (Chad, Liberia and Sudan) sends a shiver down the spine of many Kenyans. This fact is effectively being used by government and party officials to argue the case against multi-party democracy. The disturbances and civil wars that have plagued those countries, they say, could happen in Kenya, and Kenya being a fragile country would not survive.

These notwithstanding, the government appears to have gone on the offensive to put across forcefully the case for Kenya’s unique brand of one-party state. If the current perceptible shift of international emphasis on to the issue of human rights in the country is anything to go by, it is increasingly succeeding.

A one-party-state like no other

The government contends that Kenya has always been a democratic country where the freedom of choice is respected, where the people participate in decision-making and in management of affairs, and where public accountability is assured. This refers no doubt to the regular elections which have often seen large numbers of members of parliament, including cabinet ministers, lose their seats and the occasional party commissions of inquiry on major issues. These commissions, which travel round the country organising public meetings, in the government’s view, provide individuals and groups (district commissioners, trade unions, teachers, the churches, etc) with opportunities to criticise, make suggestions and influence government policies. The party, it says, has no other ideology than ‘economic progress and the wellbeing of the people’. It is simply a framework for organising the country’s political life. Although it approves the list of candidates, it neither nominates nor campaigns on behalf of members. There can be as many as twelve candidates in a constituency contest, party officials told The Courier. ‘Candidates for election risk a lot financially since there are no subsidies and they have to cover all their own campaign expenses’, a high-ranking government official said, pointing out that Kenya’s one-party system is like no other in the world, hardly comparable in structure and organisation with the sole political part ties that obtained until recently in some African countries or with the totalitarian regimes of former communist Eastern Europe.

It all boils down to the fact that the ruling party, KANU, never loses an election, and that politics in Kenya is much more about personalities than about policies. And because the contest is between individuals, it has not come as a surprise that over the years there have been murders whose motives have been suspected as political: Tom Mboya in 1969, Joseph Kariuki in 1975 and most recently, in 1990, foreign minister Robert Ouko.

But if the Kenyan government feels confident about winning the debate on democracy it is, nevertheless, aware of its vulnerability on the human rights issue, having had a number of people jailed or detained for what many considered as political offences or simple dissent. It has been accused by human rights organisations of torturing detainees.

An area of blurred vision between what is a criminal offence or pure political activity for which very few countries in the world have escaped criticism, human rights is now an issue that the international community is prepared to invoke, if need be, to interfere in any nation’s internal affairs. It is perhaps the awareness of this that has led the Kenyan government, in recent months, to take several steps designed to spruce up its image; measures which now put it in a position to challenge its critics on both human rights and on corruption. The measures include the widely applauded appointment of Amos Waco, a highly respected internationally-known human rights lawyer, as Attorney-General, the review of the cases of detainees and their release, and the enactment of legislation restoring the security of tenure for judges, the Attorney-General and the Auditor-General.

On the question of press freedom, Kenya’s press is relatively free compared with the rest of Africa, although observers note that there is a degree of ‘self-censorship’ that borders on fear. The closure of a couple of publications and the seizure of copies of the Nairobi Law Monthly review recently did the goverment’s image no good. But that does not detract from the fact that the Kenyan press is lively and enjoys a good deal of freedom. For example, despite the ban on public debate on multipartyism, it has continued to report the campaign activities of the four detainees released recently. Furthermore, the similar campaigns and demonstrations taking place currently in a number of African countries for multiparty politics are faithfully reported on radio and television.

At the time of The Courier’s visit, the pro-democracy movement campaign was not limited to pressure on donors to cut off aid to Kenya. It also involved calling for the repeal of certain legislation and dismissal of two British judges whom the opposition felt were partial and progovernment.

That the continuing campaign for multipartyism of the four former detainees is being tolerated, even though some of their activities under the existing laws could be considered illegal, itself speaks volumes about an emerging situation of freedom in Kenya. This can only win the government greater support.

Kenya’s political system is, as already noted, a matter for Kenyans. Over and above other considerations, Kenyans have to choose between two systems, one where the contest is between individuals, and another where groups are pitted against groups or tribes against tribes for political control. Tough choice for wananchi.

AUGUSTINE OYOWE

KANU, the ruing

The seeds of the one-party state in Kenya were sown in the colonial era during the struggle for economic and political rights when only one strong organisation, the Kenya African Union (KAU) emerged. Founded in 1944, mainly by the educated elites of almost all the major tribes, KAU was nevertheless predominantly Kikuyu both in leadership and in popular support. It was banned in 1953 by the British colonial administration under a state of emergency. This followed the arrest and imprisonment of its leader, Jomo Kenyatta, on a charge of involvement in the Mau Mau uprising.

During the state of emergency two Luo personalities, Tom Mboya, leader of the trade union movement, and Oginga Odinga emerged in Kenyan politics, being the most vocal opponents of the colonial regime in the absence of the mainly Kikuyu nationalists who were either in prison or in exile. It was, however, the allegiance of all politicians to the imprisoned Jomo Kenyatta that was to determine the entire course of Kenyan political life.

Boycotting national politics and cleverly exploiting their influence at the district level, Kenyan nationalists successfully campaigned for a widening of the franchise to universal adult suffrage and for self-government. In January 1960, the state of emergency was lifted and following a constitutional conference in London in February that year, the ban on national party politics was lifted. In the election that followed, Africans were returned in the majority to the Legislative Council. This led immediately to the formation of the Kenya African National Union (KANU) with the absent Jomo Kenyatta as acting President.

But, like in many African countries at the approach of autonomy, divisions began to appear among the ethnic groups, opposing principally a Luo-Kikuyu alliance against a coalition of minority tribes (mainly Maasai and Kalenjin) which feared losing out in a Luo-Kikuyu dominated government that sought access for Africans to the ‘Highlands’, an area reserved for the exclusive use of whites. Led by Ronald Ngala, the latter soon broke away from KANU to form the Kenya African Democratic Union (KADU).

There were fundamental differences in the political philosophy of the two parties. KANU could be described as having a leftist leaning, being, as it was, for a fairer distribution of land to the landless, nationalist not only in its anti-colonial posture but also in terms of the system of government it sought for the country - a unitary state with little power for regional or local governments. KADU, by contrast, sought a federalist constitution which it felt would safeguard the interests of minorities.

Although KANU won a majority in the 1961 election, it refused to form a government, in protest against the continued detention of Jomo Kenyatta. KADU, however, did, forming a coalition which lasted only a couple of months: Kenyatta, the national hero, revered by all, was released in August and bath parties rallied around him, but not for long. The debate on the independence constitution reopened the division between KANU and KADU soon afterwards. The 1963 Constitution, which granted self-government to Kenya, however, created six local governments to the delight of KADU. In the election that followed in June, KADU could not field sufficient candidates. It was decisively won by KANU. Jomo Kenyatta became prime-minister and, in December, President when Kenya became a republic under another constitution which stripped local governments of many of their powers and brought them under direct control of the central government. Shortly before this, defections from KADU to KANU had brought the existence of the former to an end. Kenyatta’s personality was to dominate Kenyan political life for the next fifteen years with KANU governing unchallenged but with enough internal politics to give the country not only a semblance of democracy but also political stability in a continent rocked by coupe and military dictatorships.

In 1966, the radical Luo politician, Oginga Odinga, then Vice-President, was expelled from the party following his criticisms of the government policy of combatting illegal squatting on private property. When he and 30 members of Parliament formed a new political party, the Kenya Peoples Union (KPU), legislation was rushed through which forced them to contest their seats in by-elections. In the event, only a handful (nine) were returned. Harassed, two defected and the KPU remained ineffectual until it was banned in 1969 following a disturbance and massacre in Kisumu, which happened soon after a visit by Kenyatta. The KPU was accused of masterminding it and its leader Oginga Odinga was detained.

Kenyatta’s determination to tolerate no other political party on the scene, or dissent was obvious until his death in 1978. Indeed the last three years of his government saw the imprisonment or detention of many dissidents, prominent among them, Seroney, Shikuku, Mutai, Anyona and the writer Ngugi Wa Thiong’o.

Kenya remained a de facto one-party state until 1982 when the Constitution was amended to make it de jure. In August that same year, a coup attempt was made by a section of the air force. Although it failed, it drove home to the authorities the depth of discontent in the country over what the coup leaders claimed were corruption and lack of freedom. With university students joining the rebel airmen and crowds in Nairobi going on the rampage, the scale of looting and loss of life was immense. The government reacted by temporarily closing down the University of Nairobi, and shaking up the armed forces. Observers note since then a change in the government attitude to public opinion, being now much more responsive to it than previously. The coup marked the beginning of a higher profile in public relations by KANU. Anti-corruption campaigns, probity in government and efficiency in the civil service have become watchwords. They remain, however, major problems despite President Daniel arap Moi’s personal commitment to combat them, particularly his crusade against corruption.

The party has also tried to broaden its appeal. It recently released the report of a Review Committee whose recommendations are designed to improve the democratic process under the one-party system. The recommendations include the abolition of queue voting (the process whereby party members line up behind their preferred candidate for nomination for election) and the abolition of the 70% rule (whereby a candidate at the nomination stage who attains 70% of the total number of votes cast in a constituency or is unopposed, is declared duly nominated as the sole candidate). Henceforth, the best placed three candidates in a secret ballot go forward for the final election. The measures also include the abolition of expulsion from the party as a disciplinary measure.

A.O.

Gearing up for industrial take-off

One of the most potent arguments in favour of the Kenyan government’s stance against the introduction of multiparty politics in Kenya is the undeniable economic progress, no doubt one of the most spectacular in black Africa, achieved by the country under one-party rule. A stable political climate, combined with a certain pragmatism in pursuance of a liberal economic policy, ensured that Kenya over the years remained relatively attractive to foreign investors even at the worst of times.

Achieving an average growth rate of 6% in the 1960s, 8% in the 1970s and 5% in the 1980s, Kenya has set its sights in the 1990s on breaking out of its predominantly agricultural economy to embrace one largely based on a broadly diversified export-oriented manufacturing. The aim is to create jobs and bring the fruits of economic progress to the majority of Kenyans for whom growth has so far meant nothing more than a pie in the sky.

This goal would appear timely for the government in the light of current pressures for political change. At about 3.8% per annum, Kenya has one of the highest population growth rates in the world. Unemployment, particularly among school leavers has risen sharply in recent years. So also has inflation in the wake of the Structural Adjustment Programme being pursued by the government. With price increases on basic commodities putting severe strains on the budget of the average Kenyan, the danger of social unrest lurks in the corner. But time is running out. With a workforce currently estimated at eight million, Kenya, according to some estimates, has to create six million new jobs by the year 2000 if it is to go anywhere near meeting demands for employment.

Although agriculture, which already occupies 80% of the working population and accounts for around 20% of wage employment, is slated for expansion (both cash and food crops), the focus is on manufacturing (the potential of which is belived to be far from realised), with the informal sector coming in for special attention.

Kenya, has had the good fortune of having laid a firm foundation for this move. It should be recalled that the country’s industrial sector developed very early because of the early presence in the country of high-income expatriates and as a result of demand for consumer goods in neighbouring Uganda and Tanzania. Thus geared, first and foremost, to import substitution and to the market of the new defunct East African Community, manufacturing grew rapidly, accounting today for 12% of the GDP.

Although the service and manufacturing industries are dominated by the private sector, the government has been very much involved, playing a crucial role not only in pioneering certain industries where there were serious gaps in import substitution but also in adopting policies designed to promote the sector. For example, it took measures to protect local manufacturers against cheap imports, ensured that local financial institutions were vibrant enough to provide credit to industry and set up the Kenya Industrial Estates (KIE) to assist in the industrialisation of the country.

Government policy in recent years has sought to encourage the spread of industry to the rural areas to provide employment and stop the drift of young people to the cities. That policy, according to officials of the Kenya Industrial Estates, has to some extent been successful in the sense that 80% of its 5000 or so assisted projects since 1972 have been located in the rural areas. These projects, which are mainly small and micro enterprises, according to KIE, support rural communities not only in employment but also in meeting demands for-such items as agricultural implements and equipment for food processing. That they failed, however, to stem the exodus from the rural areas or make a significant impact on the employment of Kenya would in itself justify a change in tactics. Although the widespread belief is that Kenya has largely achieved import substitution and that the time has come for it to produce for export, it has become clear in recent years that import substitution as a policy was no longer sustainable. ‘We were counselled quite rightly that we cannot substitute all imports and remain efficient’, explained Mrs Veronica Nyamodi, Director of KIE. Import substitution tends to encourage inefficiency. But that notwithstanding, Kenya’s export forays in recent years have been encouraging; its manufactured exports now include textiles, ceramics, furniture, metal products, wines and spirits not to mention the Tusker beer that is increasingly becoming popular in the United States. The country has also learned how to promote aggressively its exports.

So Kenya is switching to manufacturing for export with a two-pronged strategy: domestic export-oriented industries and Export Processing Zones (EPZs) with the entire world as its target market. But things will not be easy. Markets are not assured and there is the question of investment capital.

Investments

The Kenyan government has had for some years a number of schemes designed to encourage local investors to export. These include, the export compensation scheme, the duty exemption scheme and the manufacturing under bond scheme. They have not had the desired effect for a number of reasons: lack of resources to obtain the necessary technology to produce competitive goods, particularly for the PTA where Zimbabwe is giving Kenya a run for its money, shortage of foreign exchange and inflation which is eating away investment capital.

At the Kenyan National Chamber of Commerce and Industry in Nairobi, officials wear a gloomy face, complaining of lack of dialogue with the government, But it is dear there is no shortage of incentives. The trouble is, that there has been a marked decline in joint ventures and a slight decrease in private foreign investments over the past five years, and as such, the entire manufacturing sector has been robbed of the dynamism it requires.

The government, aware of that trend, took a number of measures, the most notable being the establishment in 1987 of the Investment Promotion Centre (IPC), which is charged with the responsibility of cutting red-tape and facilitating investment, ie a one-stop shop where new investment applications for permissions, registrations, licences and other approvals are treated speedily. ‘It used to take up to three years to get a project approved, but new it takes a maximum of four weeks to get everything processed,’ IPC Managing Director, Silas Ita, told The Courier. Over 229 projects, valued at $371 million, have been processed since 1987, of which 85 are already operational. ‘In my view that is quite satisfactory because, in a climate where the normal lead time for a project to take off is 36 months, we have been able to get 85 taking off within 24 months’, said Ita. The IPC boss says that the Centre receives an average of 100 enquiries every day and That about ten are processed every week - by processed he means the investors have been advised to register the company, discuss the composition of shate-holding arrangements, etc.

Mr Ita admits that the projects ate of small and medium size with capital varying KSh100 million to KSh400 million but adds: ‘You will find that they are mainly joint-ventures with quite heayy foreign investment components operating both urban and rural areas. They cut across all the nectars - tourism, agriculture, commerce and services’. If Mr Ita’s gleeful assertion is anything to go by, Kenya has found in the IPC? the formula for resolving its investment problems. The Centre has adopted high profile promotional activities, with visits to the United Kingdom, France, Belgium, Netherlands, the US, Japan and South Korea. Mr Ita claims there have been positive responses, particularly from Japan. South Africa, however, is a primary target as a source of investment. Now that that the country is emerging from its isolation, the Kenyan authorities have already begun assiduously to woo South African businessmen. Indeed, since the visit of President F.W. de Klerk to Kenya early this year, there have been a number of visits by South African businessmen to probe investment opportunities in the country.

There is certainly no denying Kenya’s attractiveness. There are more than 700 large firms operating in the country of which some 200 are multinationals. Payment of dividends to foreign factors of production in recent years have ranged from $120 million to $150 million annually. It is politically stable, has a well developed financial sector and a good infrastructure that is continuously being maintained and expanded: major projects are indeed underway to upgrade the Nairobi and Mombasa international c airports, and the Mombasa port container terminal is being extended and equipped with the latest technology. These are, of course, part of Kenya’s plan for industrial take-off in the 21st century.

Export Processing Zones

One cornerstone of that plan is the Export Processing Zone schemes. On the drawing board since the early 1970s, Kenya came to the conclusion two years ago there was no other way of realistically industrialising, creating jobs and earning substantial foreign exchange than establishing the EPZs. It has been particularly encouraged by the example of Mauritius which has gone from dependence on sugar to being an exporter of a variety of goods with dramatic improvements in its employment situation and standard of living.

Kenya feels it has one obvious advantage: an abundance of cheap labour. It also hopes to attract enterprises starved of quotas elsewhere. Three EPZs are currently planned. One, the Sameer Industrial Park, went into operation near Nairobi in November 1990. Privately owned, only two companies have so far gone into business there, although three units have actually been taken up. This represents 25% of the twelve available units. A spokesman for Sameer, however, told The Courier last August that 75% of the available spaces were in the process of being rented.

A second zone is being set up at Athi River also near Nairobi. Financed by the World Bank, the construction of sheds, roads and housing for workers will take 15 months and Mr James Magari, the Chief Executive of the Schemes, estimates it will be ready for occupation by February 1993. The third zone at Mombasa is still under study - a study being financed by the African Development Bank.

Early indications are that the industries so far most attracted are textiles and horticulture. It is expected that the EPZs will cream off a lot of skilled labour in the domestic industries. Although this will create job opportunities there, it may have a serious effect on the competitiveness of the export-oriented domestic industries.

There is, however, a danger that the enthusiasm over the EPZ is misplaced. Mauritius, which serves as a model for Kenya, launched its EPZ schemes in the early 1970s and did not begin realistically to reap the rewards for two decades. The rewards for Kenya may not be for the immediate future. Mr Magari though feels otherwise because, according to him, Kenya ‘can avoid the pitfalls that other countries had, by learning from their experiences. All we require is for one of those multinationals to start something in Kenya’. He places great hope on the quota bait. ‘As you very well know, most of those countries which started EPZs are now facing quotas in USA and EC markets, for example in textiles. The investors in those countries are now locking for a different export platform, and we in Kenya intend to take advantage of it’, he said.

A.O.

Matching resources with the population

‘The battle is not yet won’ says Dr Zachary ONYONKA

Kenya’s galloping birth rate, one of the highest in the world, risks jeopardising the country’s overall economic growth in the coming years. In this interview, Minister of Planning and National Development, Dr Zachary Onyonka explains he gavernment’s strategy to avert disaster.

· Minister, Government plans an economic growth that it hopes will outstrip the rate of population increase. It may end up chasing shadows if the birth rate is not effectively reduced. What is the gorernment’s strategy now?

- To begin with, we plan, as you said, to realise meaningful growth performance. If the rate of the country’s annual economic growth exceeds the rate of population growth, we will have no problems. We have to some extent been able to achieve that sort of difficult target because the rate of population growth has been quite high - between 3.4% and 3.8% for some time.

Now during the past two decades, we have been fortunate enough to register economic growth rates that exceeded, on average, 5.5%. Statistically that meant that in real terms we were able to register a positive growth particularly in terms of per capita. However, it is important to point out that it has not been easy. Obviously, you have here a situation where, for instance, the dependence ratio is very high, that is that we have a population structure, where over 50% of the people are below 20 years old. Now that has major implications for our overall performance, not just in terms of aggregate growth, but in terms of demand for social services and demand, for example, for education, to which we presently allocate over 30% of the annual , budget. This means that not many resources are left to cover the other social, services, like health, for which there is a tremendous demand, given this very young population structure and incidence of illness among the under-fives and so on.

But all the same, even in those areas, we have been able to register very significant improvement. However, it is obvious that this sort of relationship can hardly be maintained for long otherwise major imbalances will emerge, because it means that other sectors and sub-sectors do not receive adequate resources to perform as expected.

So this country for nearly two decades now has had a positive population policy. It started, of course, with NGOs and over time, and rather quickly, the government assumed a major responsibility by subsequently creating the National Council for Population. It is very interesting to point out that, locking at the recent data, especially the information we have obtained from the recent demographic survey, it shows clearly that there is new a downward trend in the rate of population growth. The inter census growth apparently has been 3.4%, which is lower than the 3.5% rate we were using. Despite that decline, the momentum within the system is still there. The children who are going to constitute the labour force of tomorrow are already here. The universities are full; we have 40 000 students in them. Compared with other countries in this region, that is a fairly high figure. Nearly four or five times in some cases. That means, of course, major efforts in employment creation, and it is in this context, that recently His Excellency the President directed the Party to look into the issues. In fact we are just in a position now to issue a sessional paper on development and employment. That is our next phase in our efforts to create more jobs. Of course, it is in Kenya, an immensely complicated problem, but we are determined to continue investing substantial resources to try to modify this relatively high rate of growth in population, and in this connection, I should add that we are very grateful for the assistance we have received from so many donors, both official and unofficial. In fact, as I have said earlier, in the area of population, the NGOs played a tremendous role but in more recent years the government has played a very dominant role both in seeking external resources and in allocating own resources for that purpose. The battle is not yet won and that is why we have adopted a policy of continued commitment to a positive population policy.

· In the short term though what do you intend to do, given the constraints of the structural adjustment programmes whereby you have been cutting back on investment, particularly on-education, and the demand for more places in the universities is growing. We are talking about the skilled labour force of tomorrow?

- We have of course problems that arise from structural adjustment, and we all know that this is why there has been concern for the social element of structural adjustment. Now given the sort of growth rates we have been able to record in more recent years, my honest view is that we still have some breathing space in coping with this problem. But we will have now to take very firm decision, for example, on university admissions. We are saying that, looking ahead, we are likely to limit the figure to about a 10 000 annual intake. If not, the figure seems set to escalate and apparently, in this country, there is no limit to the demand for education. Indeed, as I pointed out, we invest very much in this, but this is part of the social device, by which I mean, developing the human being and therefore it becomes so difficult to cut substantially in that sector.

What we are trying to do in the short and medium term is to reorient our whole educational system from what we have been doing before where we were producing mainly people on the primary and secondary level who were looking for white-collar jobs. You might have read in the local press that, for example, in respect to university admission, we do restrict those doing a Bachelor education arts. There is still a bit of room for Bachelor education sciences and some of the arts-English, and other specialised areas.

So we are trying to readjust the educational system to match the potential for employment. And incidentally, I should point out here that we are not looking at the problem in isolation. We are locking at it more broadly. We are saying that within the educational sector, we should give much more emphasis to technical training and here we have brought in, for example, the informal sector, the small-scale enterprise sector. In fact our second sessional paper is on our efforts to translate into concrete action this policy. The small-scale enterprise paper is really a part of the implementation policy of the larger sessional paper on employment and development. I think what we have to do, looking at the realities of the situation, is that we have got to create an environment whereby most of our people, with appropriate training and other measures of support have to go in for self-employment. And this we are really determined to do in a big way. We are looking for resources. We are hoping that donors will come out in full to support this programme, because what we are to trying to say is: “look we no longer have a situation in Kenya where you come out of school and government guarantees automatic employment. That is not feasible; that is not realistic. You had this education; put it to use. If you need support in terms of tools and hands, you have heard of the recent introduction of what we called the ‘rural enterprise fund’ where we shall be lending money with, of course, extension and supervision with out requiring the normal security preferred by the banks. Take advantage of it.”

We realise also that this is no mean undertaking. There is the ample experience of many countries that it takes a determined effort to make it work. But we believe that many of our people would be fully employed if they have the tools, the capital to do what they are already doing. So these funds will go a long way to support people who show the initiative and entrepreneurship and others out of the universities and polytechnics who really, we think, have new the capacity to create mini enterprises, which we hope will develop into large enterprises. So, in the medium and short term this is the way we are looking at the problem, but we hope that in the longer term we should experience a further decline in the rate of population growth. We have a determined policy and commitment. And then, in this country you know, leadership, right from his Excellency the President way down to the party, KANU, we are all committed to this population policy and we hope, in another decade or so, to attain a level where we can match employment prospects with the labour demands. We are aware it is not easy but if you have a stable government committed to these polices a lot can be done. This is not an easy panacea from what we have seen from other countries.

· Labour-intensive technology has been, and I am sure still is the policy of this government. In planning export-oriented industry, how would you reconcile this policy with the need to meet the high standard demands of the North. You will need sophisticated equipment, won’t you?

- I don’t think that there is a real conflict here. There are areas where we have to go in for certain technologies. We have to look at the problem, as a whole. For instance, let us look at the whole question of productivity. We believe, for example, that in the small-scale farm sector, this country has managed fairly successful development. But this is one area where we new knew from local research and observations generally that there is still a lot of potential for better performance; that farmers for example instead of producing an average of 20 Kg bags of maize per acre, we knew many of them are producing at a much lower level of about 15 Kg per acre. We believe today that there should be an average of about 32-35. Now, that requires changes, not only in respect of capital investment, but, also the technology. Out of the research that has been undertaken recently, we definitely have made some major headway. We now know from KARI, the Kenya Research Institute and other related centres, that with a change in the technology, the small-scale farmer does a lot of things on his farm. This country can, for example, produce much more maize or corn than in the past and that pertains also to several other crops. Obviously it is when this small-scale farmer becomes more efficient and more productive, able to produce for example maize at a cost level that is competitive, that the country will also become competitive. At the same time there are other sectors and sub-sectors in, for example, the Juakali small-scale enterprises, where it is quite evident that some of the equipment in use is definitely inefficient. A simple example is the way they used to make the GIKO, the little device for cooking which is fairly widely used. Now, it has been shown again that the technology used was inefficient because it involves a lot of heat loss which means that almost half of the firewood used is lost. And at very little cost, by the way, by just changing the way things are done, we have been able locally to manufacture GIKO that actually conserves energy and therefore is much more efficient and beneficial to the community as a whole. Now, I see no major conflict myself. However, you need to realise one thing, that in the past decade and a half or so, it is true, we did have some enterprises that were heavily capital-intensive. And the ratio between the formal and the informal sectors is remarkable. The ratio in fact could easily be something from one to ten, or one to fifteen, in other words, where you need to invest, for example, 1000 or 1500 pounds to generate a permanent job in the formal sector, you need maybe 100 pounds in the informal.

Now that is a very big difference. You referred to the export sector. Our main consideration actually is to improve the quality of some of the things produced in the informal sector. If the finish is good they become easily exportable. If you look at the finishing of a lot of what these people were trying to export, they were rather poor. But if you see those items today after five or six or seven years of experimentation, there is a big difference; they can easily be exported to the neighbouring countries in the PTA and even further afield. So, admittedly, there are areas where capital-intensive methods will be necessary, given the nature of the enterprise. But we have realised that if you are going to have a broadly-based development strategy, then you have got to involve a technology within the reach of the majority of these potential entrepreneurs, and this is really what we are trying to do. I will conclude on that by simply pointing out that this is an area where learning by doing is proving to be very interesting. People who before had no opportunity, no tools to operate, when these things become available are now budding, small scale entrepreneurs able to employ a lot of people. But eventually we also do hope that many more of those employed themselves will become entrepreneurs.

· Talking about farmers, given the shortage of arable land and the proven efficiency of smallholders, hasn’t the time come to break up the larger farms?

- There are not very many large farms in this country. In fact, in some of the areas where there are what are called large scale farms, the nature of the soil is such that if they were three to four acres in size, as they are for example in the area where I come from in West Kenya, you could not run them as viable enterprises. In fact, what quite often amazes me is that people talk as if there are a vast number of large-scale farms lying idle. I would like to emphasise here that where there are fairly large-scale farm enterprises in this country, a lot of that land is owned by the ADC (Agricultural Development Corporation), a parastatal that has done a lot for this country; for example, research into maize and bettering of seed for sale to farmers and so on at fairly reasonable prices. There will be scattered cases of what lock like restively large farms. Take a place like West Gusii. Now if you know the topography and geography of the area, what will you do with a farm unless you have about 100-200 acres? The soil condition is such that it is not easy. You go down to Kitale where there are what used to be very big farms, most of them under cooperatives. About five years ago, the President directed that these people receive their titles and this has been done to a very large extent. You will always come across scattered cases of individuals, whose land looks like a big farm. Our policy at the moment is that whatever land one owns must be put to productive use. Some farmers have done that. Around the area where there are supposed to be large-scale farms, I must confess that very few of them, if subdivided, will be viable. Well there are some, which can be divided but the number is really small. If you are to view that as an alternative way of making land available to small-scale farmers, it seems to me the effect will be rather negligible given the number of people involved.

However, where we are trying to make some headway is in the exploitation of our arid and semi-arid areas. We realise that in terms of capital investment, it is quite high. But when you compare the soils found in these areas with the sort of lands in other areas, it is clear that with a little irrigation, construction of dams for livestock breeding and so on, we can do much more with them. Obviously, you know, there has been a gradual shift of a lot of farmers from other areas into some of these areas. But they require special technology which, I must submit, we have to learn to copy from those who have experimented successfully with it.

· Kenya is relatively attractive to foreign investors. Privatisation is on the cards: are there specific conditions under which foreign investors can acquire shares?

- I am incidentally a member of the Committee which is at this moment locking into it. We have already had several meetings of the parastatal divestiture committee. We have formulated the general principles. But in dealing with the problem, we are looking at each case on its own merit. There will be instances where the foreign investor would be allowed to take shares or purchase an enterprise. It is a fairly flexible and pragmatic programme. When you look at the enterprises in question, they are very different, that is one thing we are all learning. Some are doing well, others are in a lot of trouble. People tend to generalise but it is quite clear that some have problems of management. There is no way the government is going to have to spare people to do the work of management: others have what you might call unrealistic capital bearing. So really in terms of viability and management, they can hardly perform well even in the longer term. We have already handled almost two dozen cases of these enterprises and many more are coming. You know there are over 200, but we are moving pretty fast - we are meeting fortnightly.

· Minister, you are very well versed in ACP-EEC matters. How would you assess Kenya’s relationship with the EEC given the LomV Convention and the approach of the single European market?

- First of all, I should point out that our relations with the EEC have been really excellent. They have been one of our major donors, very broadly dealing with microprojects and a lot of other larger funding of projects and programmes generally. In fact they have been funding some of the more important aspects of our national economic development in the agricultural sector on which we depend. They have played an important role particularly in more recent years in trying to restructure certain parastatals like the National Cereals Board and so on. Of course, the European Investment Bank has also put some money into some of the projects. And there are those rnicroprojects and programmes that are extremely popular right at the grass roots which have done a lot filling in the gaps in some of the development programmes and projects in education, in health, in water supply, roads and so on. Now, clearly, we have not always got what we thought would be ideal offers. You know these are reached after lengthy negotiations and discussions. But looking for example at the LomV Convention, there are concessions we consider would be beneficial to my country and which had been the bone of contention during the other Lomrogrammes. But definitely, compromises were struck in terms particularly of exporting, making it much more favourable and easier for our entrepreneurs to do much more business than was the case before. Admittedly, and I was party to the negotiations and the signing, we know that we still have some ‘grey areas’ if I may use that term, where the future is not very clear particularly in the context of the GATT negotiations. In my view these are the issues. We realise that politics impinges very heavily on what is finally settled upon, but it is also important for us to point out that whatever concessions we agree to, it needs to be noted that the international environment generally has proved to be much more hostile to the African countries and the other ACP countries than even we had anticipated.

The days ahead are not very rosy, particularly when faced with structural adjustment programmes at the same time as being expected to cope on your own with international competition. The environment generally still locks rather difficult. There is the whole question of debt. We are grateful that so many of the donors have moved in what I consider a positive direction, ie in a direction that involved the writing off of so many of these debts. But the remaining burden is still very heavy indeed for these countries. For the last two decades, I have been saying that I could not see how some of these ACP countries could generate meaningful, positive balances, for example, the balances of payments to be able to meet their external commitments. Some of them, in terms of viability, are really difficult cases. Nothing is in their favour and this is not likely to change because, for example, of the natural environment in which they find themselves which makes the prospects difficult Some of them produce practically no-, thing they can export to any other country either within the regional blocs or to other countries.

So, all in all, some of the provisions agreed to would help to soften the landing, so to speak. But the remaining problems in my opinion are formidable and I would like simply to add that the North, the European Community and the other more developed countries need to be more realistic. It is evident by now from the African Recovery programme discussed in the UN that the dramatic change expected during the last couple of years has not materialised and my suspicion is that in many of the countries, the situation is going to go from bad to worse. Of course, in some instances, problems of internal instability and conflict render the whole thing almost meaningless because you see, you need a viable stable government and governmental authority to manage these things meaningfully and when these factors are absent, it is difficult to see how some of these countries can be expected to perform well. I don’t know whether in fact some of the approaches being recommended by the donors - conditionalities to aid - can solve the problem. The problem is much more fundamental than what appears at the surface. They are intractable problems, very often domestic, which some of the donors and outsiders do not fully appreciate. From the outside they look simple. If you push this knob things will work. It does not work that way.

So there is the political economy of the whole business that is very intricate. That is the way I see the situation. Some countries might have recorded positive growth but not what you regard as steady, stable and dependable growth. So you see these gyrations. This year there is positive growth, the following year a negative growth of 4% then the following year a positive growth of 1%, the fifth year a negative growth of 6%. So you do not have there what can be regarded as viable growth and development. We have problems and I am not sure that the external environment is any easier than it was in the last decade.

Interview by A.O.

Pressing ahead with refonns

Despite its relatively better economic performance, Kenya has had, like the rest of black Africa, to take its IMF potion of Structural Adjustment Programme (SAP) - and that since 1987. A continuous budget deficit, balance of payments problems, a heavy debt burden, and other imbalances had to be redressed if economic growth was to be stimulated, productivity strengthened and employment created.

In 1989, the Government requested further support from the Bretton Woods institutions, for a three-year arrangement (1989-1991) under the enhanced structural adjustment facilty (ESAF). This imposed on Kenya, among other things, a fiscal discipline, a commitment to reduce the budget deficit, freeze recruitment to the civil service and privatise certain parastatals.

The implementation of these measures is proving very painful, particularly in education, which normally swallows 30% of the annual budget, and in health. Demand for these services has continued to grow. In the University sector, for example, the backlog in admissions caused by a one-year closure of the University of Nairobi by the government, for what it believed was student support for the failed coup in 1982, is not yet cleared. This has been worsened by the change in the educational system which has unloaded a large number of students at the doorsteps of higher institutions. The latter suffer from lack of qualified teachers, educational aids and accommodation for both staff and students. In the health sector, a cost-sharing exercise sponsored by the World Bank created so many difficulties for the poor and caused so much chaos in hospitals that President Daniel arap Moi had to intervene, ordering that all treatment in government hospitals should be free. It was a return to what the situation was in the 1960s when all medical services were free. The problem really was how to protect the poorest sections of the population from the IMF exigencies. The president’s intervention meant that there had to be a re-examination of budgetary priorities to restore funds for health. It is understood, however, that since then, a new scheme of cost-sharing has been devised, and there is no doubting the gavernment’s determination to press on with reforms. Indeed the 1991-92 budget saw deep cuts de signed to reduce the deficit to 2% of GDP from the 5.3% achieved in the 1990-91 financial year.

Kenya depends heavily of course on development assistance, which has risen in the past five years by over 60%. Donors, impressed by the government’s commitment to restoring the country’s economic health, have been forthcoming with assistance, mainly in the form of debt cancellations. Belgium, the United States and France have this year cancelled some of Kenya’s debt, but debt servicing remains heavy at between 25 and 30% of foreign exchange earnings. The EC, on the other hand, has financed an import support programme as a contribution to the resolution of the country’s balance of payment problems.

On the economic front, there have been some positive results from adjustment. There has been an overall increase in investment by 7%, a rise in the total value of exports by 19.1% and a fall in the current account deficit from 7.4% of GDP in 1989 to 5.5% in 1990. Agriculture and manufacturing, last year, grew 3.4% and 5.2% respectively, while earnings from tourism rose by 23% over the 1989 figure.

Reforms are continuing apace in the various sectors. In agriculture, the most notable is the EC-financed Cereals Sector Reform Programme (CSRP) which is about to enter its second phase. Begun in 1988 under LomII, the programme involves liberalising the grain market and rationalising the role of the National Cereals Produce Board (NCPB) in Kenya’s food security drive. This has meant the closure of the Board’s primary marketing networks, ie the buying centres, and the encouragement of private traders and cooperatives to be involved. The result is that 75% of NCPB purchases are now from licensed buying agents. The aim ultimately is to reduce the Board’s share of the primary grain market to 15% and the secondary market to 60%, leaving it with the main function of maintaining adequate strategic reserves for security and price stabilisation. The Board now has ten silos throughout the country.

In the industrial sector, price controls have been removed so far from 36 products, 12 are still subject to controls and these will be removed in due course, according to officials of the Industrial Promotion Centre (IPC); import licensing has been liberalised and interest rates deregulated.

Shortage of fertile land

Accounting for more than one-third of the GDP and two-thirds of exports, agriculture remains constrained by a shortage of arable land and by erosion as well as being occasionally plagued by bad weather and pests. There are around 1.5 million smallholders in Kenya with varying acreage. These farmers are largely responsible for the transformation of the country’s agriculture into one of, if not the most dynamic and diversified in Africa, with crops ranging from coffee, tea, sugar cane, maize, sisal and cotton to horticultural products. With land becoming very scarce and demand growing, the wisdom of maintaining large farms, of which there are still many in Kenya, is increasingly being questioned, although Minister of Planning and National Development, Zachary Onyonka, thinks it is not a viable option (see interview on page 18). Attempts are, meanwhile, being made with relative success to reclaim marginal lands, particularly in semi-arid areas through irrigation, but these are far more appropriate to livestock breeding than to farming. The only way of improving productivity seems to be intensive cultivation and intercropping in the fertile areas of the country. Thankfully, Kenya has almost achieved self-sufficiency in food, particularly in maize. Indeed in good years it exports.

Despite the deterioration in the terms of international trade, Kenya’s two most important exports, coffee and tea, continue to ensure high earnings. This has as much to do with efficient production as with the quality of both products. The fall in the sale of coffee has been made up largely by increased tea exports, and tea, not surprisingly, has overtaken coffee in recent years as the second most important foreign exchange earner, after tourism. Last year earnings from tea rose to Ksh 6.8 billion from Ksh 5.4 billion in 1989 against an income of Ksh 4.4 billion from coffee. Production forecast for coffee in the 1990-91 season is 60000 tonnes, well below the 75 000-80 000 tonnes expected, and nowhere near the 100 000-300 000 tonnes that the authorities have always set as a target. The expected fall in coffee production this season is due to the bad weather experienced earlier in the year and to what producers call ‘state mismanagement’ (the Kenya Coffee Board being constantly in arrears in payment to farmers). For tea, on the other hand, there is a low cloud on the horizon. Kenya will almost certainly feel the impact of the UN trade embargo on Iraq, the latter having been a valuable market. Furthermore, there is: the annoying of Pakistan, the second biggest purchaser of Kenyan tea, which is constantly threatening to boycott it in protest against the imbalance of trade between the two countries. Such a threat has to be taken seriously since Pakistan has once carried it out with disastrous consequences on foreign exchange earnings.

It would appear strange, but it is true that there is a school of thought in official circles which believes that some lands currently under food production should be transferred to tea and coffee production. These officials estimate that a transfer of 3% of lands would generate a 70% increase in foreign exchange.

Kenya’s livestock industry, which embraces traditional and commercial ranching, is recovering from the severe decline it suffered in the 1984 drought. Cattle heads have increased from 7 million to over 8.5 million. It is hoped that by 1994, barring any major climatic disaster, they will have recovered to their pre-drought level of 10 million. The success of the industry is explained in part by the numerous irrigation projects taking place in the semi-arid areas where, traditionally, nomadic herdsmen live. The industry is gradually giving rise to a hides and skins industry that is export-oriented.

The star export performer of the agricultural sector in recent years has of course been horticulture - non-traditional commodities of considerable hope for the future, which now include, fresh cut flowers, french beans, sweet carrots, passion fruit, pinespples, and off-season strawberries. With markets in the Middle East and Europe, the industry has become so well organised that fresh flowers cut in the evening in Kenya, for example, could be in all major European markets in the morning. Although facilities now being provided at Nairobi International Airport will go a long way to improving freight, the producers are exploring the possibility of exporting by sea, because the growth of the industry is such that there would continue to be a shortage of air-space. Already, quantities of bananas, mangoes, pineapples and avocadoes are being shipped. As a measure of the importance of this industry, in 1990, horticultural products earned Ksh 3.19 billion, a 36% increase over the Ksh 2.34 billion earned in 1989. This represented a doubling of export earnings in just four years, from Ksh 1.77 billion in 1987.

The industrial sector is of course a money spinner for the country with its wide range of exports, particularly to the Preferential Trade Area. A major expansion of this sector is planned (see article on page 15). Of particular note here are the substantial earnings from petroleum exports. Kenya has no known oil deposits of commercial value. The discoveries made in 1988 at Isiolo and Turkana districts have still not been evaluated, but the country imports crude oil which it refines at Mombasa. With an output of around 2 million tons annually, domestic needs for petroleum products are met and the remainder is supplied to Burundi, Rwanda, Uganda and eastern Zaire. The refinery, Kenyan Petroleum Refineries Ltd. (KPRL) is jointly owned by the Kenyan government and a group of oil companies. So successful has this policy been that another refinery is planned at Mombasa in joint venture with Iran, which will provide the crude. It will come on stream by 1993 if the proposed plan, as is being suspected, is not a ploy by the authorities to get their partners in KPRL to expand the existing refinery. The success of this policy can be attributed in part to the fact that Kenya derives nearly 15% of its energy needs from the Olkaria geothermal station and another 5% from hydro-electricity, the latter becoming more and more important every year as a source of energy.

Tourism: still going strong

Tourism, the most important foreign exchange earner, remains as vibrant as ever and is set to grow even stronger in the years ahead as Kenya’s attractiveness remains unbeatable. In 1989, tourism earned Ksh 8 billion (US$ 348 million) from 730 000 visitors. In 1990 there were 801 000, not too far from the target figure of one million. Although the number of visitors this year is likely to fall slightly because of the Gulf war, which dissuaded a lot of Americans from travelling early in the year, the* has been a sudden rush in the summer months. This is partly as a result of the devaluation of the Kenyan shilling which has made holidays in Kenya much cheaper than in most of its competitors, partly because of the greater security which tourists now enjoy in the wake of the strict measures taken by the authorities to counter activities by criminal gangs. There are new, for example, greater patrols of the game reserves following a few murders from. which Kenya received very bad publicity.

That investments in tourism have continued to grow, despite its already good infrastructure, is evidence of confidence in the future of the industry. This is happening at a time when Kenya is in full control of the preservation and management of its greatest asset - wildlife, thanks mainly to the setting up of the Kenya Wildlife Services (KWS) two years ago.

Following the public burning of ivory worth more than $3 million by President Moi, a successful worldwide campaign for curbs on trade in ivory and stringent anti-poaching measures at home, KWS reports a virtual cessation of elephant poaching in Kenya. Now the game reserves are being properly managed, with a number like the Meru National Park and Tsava East and West, receiving facelifts: roads rehabilitated, gates painted and officers in uniforms. It will now be possible to provide tourists with a wider choice in game reserves to avoid concentration on a few and serious environmental damage. The KWS’s most important task and no doubt one that will, if successful, ensure long-term stability and peace in the parks, is the resolution of the conflict between wildlife and the economic needs of local inhabitants. It intends to do this by allocating part of the revenue from park fees to provide social amenities for the communities. This is already being done in some places and, according to the KWS, the response of the people has been positive as they see the economic advantages of preservation. A sensitisation campaign, however, is continuing not only around the parks but also around the country. Perhaps the most ambitious plan in efforts to resolve the conflict between wildlife and people is the move to fence off the parks so that ‘the animals will be free in their area without interference from settlements and the settlements free from wildlife’, explained Minister of Tourism, Katana Ngala. Over 2500 km of fencing country-wide is involved. ‘Fencing has already started in a few areas and we hope to complete the whole exercise as soon as the money has been raised’, said Mr Ngala. Indeed the whole reform of the wildlife sector is being bankrolled by donors. Over $14 million have so far been raised, with the World Bank and The European Community contributing the largest sums. The Director of KWS, Richard Leakey, who is the force behind Kenya’s wildlife conservation campaign, has also been involved in fondraising all over the world with considerable success.

A.O.

Profile


Kenia

Area: 582 646 sq km. From a low coastline in the Indian Ocean Kenya rises to around 1700 metres around Nairobi, is intersected by the tectonic Rift Valley and then stretches on to Lake Victoria in the West. This constitutes the only fertile region of the country. The rest, which stretches north and north-eastward to the borders with Ethiopia and Somalia, are semi-arid and arid.

Population: 24.9 million (UN estimate 1989). About three-quarters of the population are of Bantu extraction: Kikuyu, the largest, Meru, Embu, Kamba, Abaluhya, Nyika, Digo, Duruma, Pokomo. Others are Kalenjin, Luo and Maasai. There are significant numbers of Europeans, Asians and Arabs.

Languages: English and Swahili plus local ethnic languages.

Capital: Nairobi.

Major towns: Mombasa (main port), Kisumu, Malindi and Nakuru.

Economy: The economy rests on agriculture which accounts for one third of GDP and approximately two thirds of exports, made up mainly of coffee, tea and horticultural products. The other significant income-generating sectors are manufacturing, commerce and tourism which together account for one-quarter of GDP. Government services account for 17% of GDP.

Currency: Kenyan shilling (Ksh) = 100 cents. Ksh20 = K£1. Ksh38.55 = US$ 1.

GDP at factor cost (1989) K£ 3243.7 million, projected to rise to K£4222.9 million in 1993.

EEC at the grassroots

The European Community’s development impact in Kenya is real and widely appreciated, from officials in Nairobi through District Officers down to the Maasai herdsman or the Kikuyu small farmer. This is not so much due to large-scale projects and programmes of which there is no shortage, as to the numerous micro-projects designed to solve the basic problems of the grassroots Kenyan. There are well over 90 EC-financed micro-projects throughout the country and more are on the drawing beard. The Courier visited two: the Kisamis mini-dam and the Mary Hill mini-project in Kiambu.

The Kisamis dam

Located in the Maasai country, this project had its origin in a group of American nuns who visited the area in the early 1980s. The nuns wanted to know what the inhabitants wanted most. They were told it was water, not surprisingly because the area is semi-arid and herdsmen usually walked long distances in search of water for themselves and their animals. The latter were dying in large numbers especially in times of drought. This gave rise to the idea to build a dam across a small valley through which torrents of water rushed during the rainy season. The nuns had no money, but their idea appealed to the District Officer who submitted it to Nairobi and from Nairobi to Brussels for financing. Work on building the mini-dam began late in 1985 and was completed in 1987. Since then, the lives of the inhabitants have been dramatically transformed. There is now pipe-borne water in the surrounding villages, and even troughs specially provided for cattle.

The Courier met Apolo Kagwa, chairman of the local committee which was involved in the planning and execution of the project. He is full of praise for the EC’s intervention. ‘I have not heard of a single cow which died of thirst since water started flowing’, he said. Cattle production has improved as well as the quality of life of the people. Mr Kagwa indicated the population of the area has trebled as the normally nomadic Maasai settle down thanks to the availability of water. But this is creating a problem of its own: overgrazing is occurring, especially on the slopes of the valley and this has provoked serious erosion which brings down large quantities of mud into the lake, silting it up and reducing the volume of water.

Mr Kagwa suggests, as a solution, the fencing off of the dam and the banning of grazing around it. Asked why he could not organise that himself, he said that the Chief, whose official responsibility the dam was, was constantly absent from the district. Officials at the Ministry of Finance in Nairobi, who are responsible for the project at the national level, are aware of the problem. They admit that one element that was absent in the Kisamis project (an element that is now taken into consideration in new microprojects) is training for post-project maintenance The case of Kisamis will be rectified, they said.

Mary Hill mini-project

Mary Hill is a residential girls’ secondary school in Kiambu district, which was founded as far back as 1933 by a group of missionary sisters. The school was later handed over to the government with an important asset - land amounting to approximately 50 acres of which 20 are being used for coffee growing, horticulture and livestock rearing.

In 1981 the school introduced agriculture as an examinable subject. With the change in Kenya’s educational system, ie the introduction of the 8-4-4 system in 1984, which lays heavy emphasis on practical agricultural skills for self-reliance, the school’s Board of Governors decided to expand the discipline. It drew up an integrated project which included irrigation and water supply, a coffee factory, an agricultural workshop, farm equipment, a Home Science block and staff houses. EC financing was sought to the tune of Ksh 4267 180 while parents of the pupils and the government have to provide Ksh 1 450000. The enthusiasm of the parents for this project was clearly shown in the manner they carried out their share. This was the construction of the Headmistress’s house in record time. The project which began in 1988 has been completed and the commissioning was being held up by power supply problem, at the time of The Courier’s visit.

What is striking about the Mary Hill project is the fact that it is expected to have a nationwide impact and that it is designed to enable the school not only to be self-sufficient in food but also to be self-financing.

Mary Hill has 500 pupils chosen from all over Kenya, on the basis of an entrance examination. From its horticultural garden it is expected to procure its own needs in vegetables. It can have beef from its livestock rearing and above all derive a higher income from its coffee.

Although Mary Hill has been selling its coffee directly to the Coffee Board, it has been doing so with it unprocessed. The factory component of this project will enable the school to give value-added to the product. The factory could also bring in additional income by processing coffee for farmers in the area, by giving value added to the farmers’ product and improving their income.

Every single pupil of the school has been made aware of the EC’s contribution to their education and they have expressed their gratitude through The Courier to the European Community.

A.O.

Financial cooperation between Kenya and the EEC

by Tue ROHRSTED

Financial cooperation between the EC and Kenya goes back to l 975 when Kenya became a signatory of the first Lomonvention. Close commercial, economic, financial and technical links have grown since then through the development programmes and projects funded under Lam, II, and III and through other facilities offered to the ACP States through the Convention.

Kenya’s economy is based on the agricultural sector add the Community’s assistance to Kenya has always been concerned with this sector and on creating rural development for the fast growing population of Kenya. Under LomII, the objectives have in particular been to emphasise food security and address ‘the issue of a better balance between the rural and urban society.

Because of Kenya’s importance as a transit country’ for the landlocked states of eastern Africa, the EC has been engaged, over the three Conventions, in financing important road projects.

Lom - 1975-1980 (4th EDF)

Kenya was allocated ECU 72 million under the 4th EDF as programmable resources. The assistance was concentrated on the rural sector, the biggest projects being the Machakos Integrated Development programme, the Bura Irrigation Scheme and the establishment of veterinary centres, cattle dips and other facilities of livestock in the Taita/Taveta Districts. To enhance rural electrification, the EDF further participated in the Upper Tana River Hydro-power Scheme.

Under Lom, the Commission started its Micro-Projects Programme in Kenya which has since been funded under both LomI and III with new tranches of assistance.

A significant Multi-Annual Training Programme formed part of the Community’s assistance under the first Lomonvention.

The European Investment Bank (EIB) has, over the whole Lomeriod, been actively involved in supporting Kenya’s development: under the First Lomonvention, the EIB provided loans to the tune of ECU 53.6 million.

LomI - 1980-1985 (5th EDF)

Under LomI, the EDF provided ECU 88 million in programmable resources and the EIB, ECU 47.2 million in loans. The most important Community-funded operations were in rural development and transport. The Machakos Integrated Development Programme, continued to be the biggest project in rural development, followed by the Smallholder Rice Rehabilitation programme and the Kisii Valleybottom Integrated Development Programme. The Micro-Projects Programme continued with four new tranches funded under LomI. The transport programme consisted of four roads: Sergoit-Tambach, Turbo-Webuye, Tambach-Biretwo and Kiganjo-Nanyuki. The latter was completed in November 1990. Under education and training, a new Multi-Annnal Training Programme was funded and the Community financed Kenya’s third polytechnic: the Eldoret Polytechnic - which was completed by the end of 1987. In the area of health research, the Community provided funds for the extension of the Institute of Primate Research in Karen. Finally, Kenya benefited from support from the EC for its National AIDS Control Programme. The EC support was utilised for the clinics for Sexually-Transmitted Diseases in Nairobi and Mombasa.

LomII - 1985-1990 (6th EDF)

Two objectives were agreed between the Government of Kenya and the EC for assistance to rural development under LomII. Firstly, the Commission should assist Kenya in achieving and maintaining food self-sufficiency. Secondly, the EC was to assist Kenya in redressing the rural-urban balance.

Outside the area of concentration (rural development) it was agreed that support should be given to strengthen the Northern Corridor Transport Network. A major structural adjustment programme for the cereals sector (CSRP) was initiated with EC assistance, Out of the total allocation of ECU 128 million under LomII for programmable resources, ECU 65 million was allocated for the CSRP.

The purpose of the structural adjustment programme was to liberalise grain marketing by abolishing the monopoly situation of the National Cereals and Produce Board (NCPB) and transform its role to-that of a buyer of last resort and manager of security stocks for the country. The three-year Cereals Sector Reform Programme financed by the EC is expected to be extended by a- further three years to be funded from: resources under LomV.

A part of the EC contribution was utilised as an Agricultural Sector Import Programme for Kenya and the couaterpart funds derived from this programme were used to establish a Crop Purchase Revolving Fund with NCPB to enable farmers to be paid on time for their maize supplies. The package also consists of an investment component particularly to improve storage and transport for the NCPB to reduce handling and storage costs.

Also aiming at achieving and maintaining food self-sufficiency is another major project unde LomII: the Kenya Agricultural Research Institute (KARI), with an EC contribution of ECU 20 million. KARI encompasses all agricultural and livestock research centres in Kenya and is responsible for carrying out applied research to enhance agricultural production. The Community has in particular involved itself in supporting livestock research and soil and water management, including a programme on fertiliser use.

The third larger programme to improve food security is the Arid and Semi-Arid Lands (ASAL) livestock development programme which aims at improving livestock production in nine districts in the ASAL areas of Kenya on a sustainable and ecologically sound basis The Micro-Projects Programme also continued under LomII.

Outside the sector of concentration, the Community funded under LomII, major rehabilitation to the Northern Corridor Transport Network from Nairobi to the Kenya-Uganda border - in total, a stretch of 107 kms.: the Westlands-St Austins, Kabete-Limuru, Eldoret-Turbo and Webaye-Malaba roads.

In the area of cultural cooperation, the EC supported the strengthening of the research capacity of the National Museums Kenya and in the area of wildlife conservation, the Community embarked on the Masai Mara Conservation Scheme.

The European Investment Bank contributed under LomII with an amount of ECU 78.5 million, distributed between loans for the construction of tea factories under the Kenya Tea Development Authority, the Kenya Ports Authority for the improvement of berthing facilities and oil installations for Mombasa Harbour, the Nairobi Water Supply Scheme, an industrial sector import facility and a loan to the Development Finance Company of Kenya.

LomV - First Financial Protocol - 1990-1995

The LomV Indicative Programme allocates to Kenya, ECU 140 million in programmable resources in addition to which ECU 23.5 million (as a first tranche) is available under the Structural Adjustment facility of the Convention.

The programming was carried out in late 1990 and the indicative programme was signed in Nairobi in February 1991 by the Vice-President and Minister of Finance, Prof. G. Saitoti, on behalf of the Kenya Government, and Mr P. Pooley, Deputy Director-General for Development, on behalf of the Community.

It is envisaged under LomV to continue the Community’s support for the food security aspects of the agricultural sector, in particular a second and final phase of the Cereals Sector Reform Programme and further support towards the establishment of a livestock industry in Kenya. The Community investment in road rehabilitation and construction will also continue.

The EIB’s allocation for Kenya under LomV’s First Financial Protocol is ECU 90 million.


Summary of Community aid to Kenya a through the Lomonvention (as at 30.09.1991)

Stabex

Kenya submitted its first application for Stabex compensation for loss of export earnings on coffee for the year 1980. Kenya has since received compensation for the years 1981,1986,1987,1988 and 1989 totalling a transfer from the EC of ECU 115.8million. Kenya’s Stabex claim for 1990 is at present under consideration. The compensation from Stabex has been of crucial importance to Kenya, in particular after the collapse of the International Coffee Agreement as revenue from coffee exports was for long, Kenya’s biggest foreign exchange earner. Now the drop in earnings has changed this situation, placing coffee in third place after tourism and tea.

Regional cooperation

Kenya, being in the centre of much regional cooperation in the eastern Africa region, is host to a number of regional institutions whose programmes receive support from the EC, e.g. the Organisation of African Unity’s Inter-African Bureau for Animal Resources through the Pan-African Rinderpest Campaign, the Desert Locust Control Organisation for Eastern Africa with its Armyworm Project, the International Centre of Insect Physiology and Ecology with its Tse Tse Fly Control project, the International Organisation for Migration’s Reintegration of Qualified African Nationals Project and the construction of the African Medical Research Foundation’s Headquarters in Nairobi. Kenya has benefited from regional funds from the Lomonvention in particular for road projects connected to the Northern Corridor.

Other areas of financial assistance

Outside the Lomonvention, Kenya has, since 1988, had a multi-annual food aid agreement with the EC under which Kenya receives annually, 15000 tons of wheat to assist in covering its deficit in wheat production. The wheat is monetised and the counterpart funds are utilised for rural development projects or to support the CSRP.

A number of research grants have been given to research institutions in Kenya, in particular the National Museums of Kenya and its Institute of Primate Research and the University of Nairobi for research in areas of tropical agriculture and health.

A number of European non-governmental organisations received support for projects and programmes in Kenya under the NGO/EC cofinancing scheme. From 1976 to 1990, a total of 224 projects have received support from the EC.

T.R.