TEXT: Kenya Vision 2030 is the long-term development blueprint for the country and is motivated by a collective aspiration for a better society by the year 2030. The aim of Kenya Vision 2030 is to create “a globally competitive and prosperous country with a high quality of life by 2030”. It aims to transform Kenya into “a newly-industrialising, middle income country providing a high quality of life to all its citizens in a clean and secure environment".
The Vision
The Vision is a product of a highly participatory, consultative and inclusive stakeholders’ (international and local experts, ordinary Kenyans and stakeholders from all parts of the country) process carried out between October 2006 and May 2007. Between July and August 2007, the contents of the Vision 2030 were again subjected to open consultations in all provinces in Kenya before the document was finalized.
A national long-term development blueprint to create a globally competitive and prosperous nation with a high quality of life by 2030, that aims to transform Kenya into a newly industrializing, middle-income country providing a high quality of life to all its citizens by 2030 in a clean and secure environment.
Pillars Of The Vision
Moving the Economy up the Value Chain
Economic Pillar:
This pillar aims to achieve an average economic growth rate of 10 per cent per annum and sustaining the same until 2030.Investing in the People of Kenya Social Pillar: This pillar seeks to engender just, cohesive and equitable social development in a clean and secure environment.
Investing in the People of Kenya
Social Pillar:
This pillar seeks to engender just, cohesive and equitable social development in a clean and secure environment. Moving to the Future as One Nation
Political Pillar:
This pillar aims to realize an issue-based, people-centered, result-oriented and accountable democratic system.
Deploying World Class Infrastructure Facilities & Services.
Enablers and Macros:
The economic, social and political pillars of Kenya Vision 2030 are anchored on the foundations of Macroeconomic stability;
Infrastructural development;
Science, Technology and Innovation (STI);
Land Reforms;
Human Resources Development;
Security and Public Sector Reforms.
To support the implementation of the Vision and the Government agenda, the Government of H. E Dr. William Ruto established the Bottom-Up Economic Transformation Agenda.
To promote the Bottom–Up Economic Transformation Agenda, the Government of Kenya is implementing policies and structural reforms and promoting investment in five pillars that are expected to have the highest impact at the bottom of the economy. These are
• Agricultural Transformation and Inclusive Growth;
• transforming the Micro, Small, and Medium Enterprise (MSMEs) Economy;
• Housing and Settlement;
• Healthcare; and
• Digital Superhighway and Creative Economy.
To make these five core pillars feasible, the Government is implementing strategic interventions under the following key enablers:
• Infrastructure;
• Manufacturing;
• Blue Economy;
• the Services Economy,
• Environment and Climate Change;
• Education and Training;
• Women Agenda; Youth Empowerment and
Development Agenda; Social Protection; Sports, Culture and Arts; and Good Governance
The Bottom-Up Economic Transformation Agenda (BETA)’s main objective is to improve the livelihoods and welfare of Kenyans.
The five pillars are elaborated as:
Agriculture
Crop Production
Livestock
Fisheries
Digital & Creative
Economy
Infrastructure
Platforms
Skills
Entrepreneurship
MSMEs
Trade & Markets
Financing
Business Development
Support
Affordable Housing
PPPs & Financing
(Developers)
Mortgages
Health
Primary healthcare
Health Insurance
Coverage
Health Systems capacity
Health Data Systems
Agricultural Transformation and Inclusive Growth
Agriculture is the largest sector of the economy, contributing half of Kenya’s GDP, a quarter directly and another quarter indirectly. Two-thirds of Kenyans derive either all or part of their incomes from agriculture. Agriculture thus remains the foundation of the economy. Many of the challenges that we are experiencing can be traced to agriculture either directly or indirectly.
At a time when the price of unga has hit an unprecedented Sh200,, the role of agriculture to the cost of living need not be laboured. Food accounts for 54 percent of household expenditures and poor spend 60 percent or more. Agricultural productivity has not kept up with population growth resulting in higher dependence on food imports.
Extreme poverty and vulnerabilty is also an agricultural phenomenon. An estimated two million households, one in six, are food poor. is, they are unable to meet the body’s food requirements every day. The vast majority of these majority are farmers. They have land but they lack the resources to raise productivity to meet their subsistence needs.
Kenya Kwanza believes that this money would be better spent supporting these farmers to raise productivity, because by doing so, the farmers are not only able to feed themselves, but also generate a surplus that contributes to national food security and the economy has highest growth multipier effect on other sectors due to strong backward/forward linkages (farming accounts for only 20% of agricultural value, rest coming from input supply, processing, logistic and distribution).
Food accounts for 54% of household expenditures and poor households spend 60% and more Jobs Agriculture has the highest employment multiplier i.e. agricutural growth creates more jobs in other sectors than any other sector, owing to its strong forward and backward linkages to other sectors of the economy.
External balance (exports, imports, foreign exchange Highest potential to increase exports in short time eg. Coffee production is now below 40,000MT from a peak of 130,000MT, and potential of 200,000MT+. Huge potential to reduce import dependence on imports of basic foods that country can produce competitively notably edible oils and rice.
The case for investing in agriculture as the sector that will lead the economic recovery is predicated on four factors
Agriculture First
Agriculture offers the quickest payback period for investments. This is because in many cases, there is no new capital investment required. Increasing production only requires addressing the cost, quality and availability of inputs (animal feeds, seeds, fertilizers, pesticides etc), and providing farmers with the working capital to be able to purchase adequate supply of the inputs as well as other direct production expenses such as ploughing of land and labour. Consider the case of dairy sector. The biggest challenge that farmers are facing is the cost of animal feeds. We know that nutrition impacts on milk production in a matter of weeks. With a dairy herd estimated at 2.2 million lactating cows, an increase in average productivity by 0.5kg per cow translates to 400m kilograms of milk with a farm gate value of Sh16b at Sh40 per kg. We have estimated that provision of Sh4000 per cow, a total of Sh8.8b would be sufficient working capital for our dairy farmers.
Cost of living
The cost of living that we are experiencing can only be resolved by raising agricultural productivity. The battle is between farmers needing higher incomes and consumers who want low prices. Maize is a good example: Planting an acre at a cost of Sh5000 and producing 10 bags equates to a cost Sh500 per bag while producing 25 bags equates to a cost pf Sh200 per bag. So the higher the number of bags produced per acre the lower the cost of production. A farmer may see price they are paid and cost of diesel as the main challenge while in fact the problem is low productivity. The same applies to fixed costs such as labour, since weeding an acre with a ten bag or 25 bag crop takes same amount of labour. So by enhancing productivity through access to affordable inputs including fertilizer and certified seeds we will see the farmer earning more money and subsequently reducing the six million bags imported on average annually and lower the cost to the consumer.
Jobs
Agriculture has the highest employment multiplier effect i.e. agricultural growth creates more jobs in other sectors than any other sector, owing to its strong forward and backward linkages to other sectors of the 15 economy. Research conducted by Kenya Institute for Public Policy Research and Analysis (KIPPRA) shows that four of the five value chains with the highest job creating impact are agricultural. The five are livestock (cattle, sheep & goats), hotels & restaurants, poultry, vegetables and rice
Incomes
As noted two thirds of Kenyans derive all or part of their incomes from agriculture. Thus agriculture led growth will put money in more peoples pockets directly than any other second. This also means that agricultural incomes have the the highest income multiplier, that is, when farmers have money, they buy consumer goods and services from other sectors. Moreover, given the large share of food in household expenditures, savings on food costs have a very large multiplier effect on other sectors. A 10 percent reduction on cost of food for a middle class household with a monthly food budget of Sh20,000 translates to a saving of Sh24,000 per year. Nationally, the food expenditure of Sh3 trillion translates to a saving of Sh300b that households will spend on other goods and services, equivalent of a economic stimulus in the order of 10 percent of the budget, or 2.5 percent of GDP.
Foreign exchange
As noted, our dependence on food imports has grown considerably in recent years. Edible oils, palm oil primarily, is our second largest import after petroleum, on which we are spending Sh60b a year ($600m) before the recent price surge, which pushed the import bill to over Sh90b ($750m). Our rice deficit is in the order of 600,000MT, costing Sh25b ($208m) about the same as our coffee export earnings. Three food commodities edible oils, wheat and rice are consuming an equivalent of 25 percent of our merchandise (goods) export earnings. We have the capacity to produce a bigger share of our consumption of both edible oils and rice competitively. Agriculture is also the sector that we are most globally competitive both in traditional exports such as tea, coffee, cut flowers and vegetables as well as emerging export crops such as avocado and macadamia nuts. Coffee production has fallen to below 40,000MT from a peak of 130,000MT, against an estimated potential of 200,000MT, which translates to a potential increase in coffee export earnings five-fold. We have several export crops that have collapsed notably pyrethrum, which we were once the world’s leading producer with over 90 percent of world market share, cashew nuts and bixa.
Ending poverty Extreme poverty and vulnerability is also an agricultural phenomenon. An estimated two million households, one in six, are food poor. That means they are unable to meet the body’s food requirements every day. The vast majority of these are farmers. They have land but they lack the resources to raise productivity to meet their subsistence needs.
Kenya Kwanza believes that support to farmers to raise productivity would not only enable them to feed themselves, but also generate a surplus that contributes to national food security and the economy.
Housing and Settlement
Urban housing
Housing is enshrined in our constitution as one of the basic social and economic rights, to wit, the right to “accessible and adequate housing, and to reasonable standards of sanitation” (Art. 43(b)). The requirement for new urban housing is estimated at 250,000 units per year, against a production of 50,000 units, translating to deficit of 200,000 units. The cumulative deficit is estimated at two million units. As a result more than 60 percent of urban Kenyans are living in slums and other low quality housing without adequate sanitation, undermining their dignity and exposes them to health hazards. This is also a reflection of the bias towards upper income housing. Of the 50,000 units being produced, only two percent i.e. 1000 units are classified as affordable housing. Moreover, our rapid urbanisation rate at 4.4 percent, equivalent to 500,000 new city dwellers a year, means that the housing supply is a moving target.
Rural housing and settlement
The right to housing as enshrined by the constitution is not limited to urban settlements. Indeed the vast majority of Kenyans live in their owned rural homes. That said, rural Kenya also has its fair share of land and settlement related challenges, including landlessness, insecure land tenure, notably the historical squatter problem in the Coast region. Population pressure on land resources is manifested by land fragmentation, encroachment of forests and other ecologically sensitive areas and human wildlife conflict. This is despite the country having considerable amount of un and underutilized agricultural land. Over the years administrative solutions such as that limits on land subdivision, as well as ceilings on land ownership and taxing of idle land have been mooted. Kenya Kwanza are persuaded that such measures should be a last resort, only if more friendly.
Health Care
A good health care system is something all countries struggle to achieve. The Covid19 pandemic has demonstrated how important this is, and also shown that even wealthy countries can be badly exposed by health emergencies. One of the lessons from the Covid19 crisis is that although resources matter, the qualitative aspects of the system matter more for health outcomes.
Our country is moving in the right direction, but we need to be more creative, deliberate and ambitious in how we use the substantial resources that we are spending on healthcare to address both old and emerging challenges. We need to build on the momentum of recovery from the Covid19 pandemic to build back better, for we know not when the next health emergency will hit. Of particular concern is the growing burden of non-communicable diseases, cancers, heart disease and diabetes related complications in particular, that if not addressed urgently, will become a threat not just to health but to the socio-economic wellbeing of the country. Presently, 36 percent of Kenyans are at risk of being impoverished by the financial burden of catastrophic illness. There is also the question of financing of programs that are currently heavily donor dependent and yet not properly planned for transition to domestic financing even as donors make plans to transition out. The HIV, TB, Malaria, Family Planning, Immunization, and nutrition programs are key donor funded programs and the gains already realized as a country must be safeguarded.
The most recent assessment shows that our total health expenditure (THE) stands at Sh550b per year, financed by government (63 percent), by households “out of pocket” (27 percent) and the balance of 10 percent also by households through insurance schemes. The out of pocket share translates to Sh150b per year, which is a big burden to households. This is the reason that one in three families is at risk of falling into poverty impoverishment by the financial burden of catastrophic illness. The number is growing daily as the non-communicable disease burden grows. Over the last decade, considerable progress made in enrolling Kenyans in NHIF, has seen insurance penetration double from 10 percent of the population in 2003, to 20 percent in 2018. That said, the penetration is uneven with Nairobi at over 40 percent while Wajir is still below one percent. This increase in contributions was achieved partly by increased enrollment and partly by change of contribution structure from a flat rate ofSh300 per month to a graduated contribution ranging from Sh150 to Sh1700 per person.
But the NHIF still falls far short of the social health insurance scheme that it ought to be both in terms of its design as well as operational performance.
These shortcoming include:
• NHIF is primarily designed to be funded by statutory payroll deductions from employees in the formal wage economy. As observed earlier in this manifesto, this number is only 15 percent of Kenya’s workforce. While NHIF has sought to expand coverage to the vast majority who are self-employed through voluntary enrollment. This has come with challenges notably intermittent payments typically people enrolling when they are unwell. This is a systemic problem of insurance known as adverse selection. The statutory payroll system is also inequitable because deduction is on individuals while benefits accrue to households. Thus households with one payroll worker and those with two or more receive the same benefits even though they contribute different amounts.
• Shift towards curative at the expense of preventive care, with the share of inpatient expenditure increasing from 23 percent to 29 percent over the last decade (2010 - 2020), while the preventive care spending declining from 24 to 12 percent. The shift from cheap to expensive is a systemic problem with insurance financed health care systems.
• Fragmented overlapping schemes within the NHIF, e.g., Linda mama, civil servants scheme, school children and elderly support that undermine the principle and benefits of the widest possible risk pooling, that a social health insurance scheme is supposed to provide.
• The operational capacity has not grown in tandem with enrollment leading to ine_ciency, high administrative cost, and poorresponsiveness to its customers and service providers.
Digital Superhighway & Creative Economy
Kenya has invested heavily in ICT infrastructure and services over the last two decades. This infrastructure include six submarine fibre-optic cables offering broadband connectivity, 9000km of terrestrial fibre-optic cable connecting virtually all county headquarters, and geographical and population mobile broadband coverage of 56 percent of the 96 percent respectively.
Mobile telephone penetration and innovation has enabled Kenya to increase from a quarter to over 80 percent of the population in less than two decades, making Kenya one of the world’s leading users of mobile payments. The COVID19 crisis demonstrated just how critical the digital penetration in terms of business continuity, as it enabled many essential services to proceed with minimum interruption during the lock-downs. Still, important economic benefits expected have yet to materialise. Notably, there was high hope that the business process outsourcing (BPO) industry would become a leading export and job creating sector. Kenya was ranked together with The Philippines, which exports $30b and employs an estimated 1.3m people. The industry has yet to take off. The Konza Technopolis has been in the works for two decades and seems no closer to becoming a reality than it was a decade ago. Digital superhighway will also play a critical role in enabling us to make tremendous achievement in the 4 other pillars of Health, Agriculture, MSME and Financing as well in enhancing revenue collections via automation of VAT systems. It will ameliorate challenges related to information asymmetry in markets access and risk management. It also comes in handy in minimizing barriers to entry for new financial providers that are critical in downscaling access to the Hustler Fund via Government risk mitigation mechanism through provision of ERP system for all participants.
Manufacturing
Our manufacturing sector is headed in the wrong direction. At a time when we should be industrializing, the manufacturing share of the economy is declining. It has fallen from 9.3 percent to 7.6 percent in five years (2016-2020). Paradoxically, manufacturing has borne the brunt of the infrastructure investment drive that is meant to spur industrialisation in terms of the crowding out from the credit market by government, and latterly, by the external debt service pressure on foreign exchange that has seen the government resort to rationing foreign exchange for the first time since the foreign exchange market was liberalised in 1993.
Kenya Kwanza is committed to help our manufacturers weather this storm. Our economic turn-around strategy outlined in this manifesto is meant to put them behind us as quickly as possible.
Environment & Climate Change
Key issues. Climate commitment to reduce emissions by 32 percent relative to “business as usual” by 2030. Climate change impact mitigation, adaptation and resilience. Constitutional mandate to ensure at least 10 percent land area forest cover. Mainstreaming ecological sustainable development. Issues not mutually exclusive. Kenya Kwanza approach: Bottom up 3P (people,planet profit) solutions. Priority value chains: biomass energy (woodfuel), agroforestry, solid waste management]
Education
Education is the ultimate means of engendering an equitable society. Equitable education ensures that every child has a chance to fulfill their potential and rise to the highest level of accomplishment irrespective of their social background. Conversely an inequitable education system, that is one which favours those from socially and economically advantaged backgrounds, is the surest way of maintaining or developing a class society.
Universal primary education achieved through FPE, but education outcomes remain highly inequitable. Considerable progress has been made towards universal secondary education but the current tiered system because boarding costs put the better resourced national schools out of the poor’s reach. The cost of joining a boarding secondary school is now Sh80,000 which even for ordinary working Kenyans is a big sacrifice. While bursaries mitigate some of this bias, they are far from adequate. Distress calls for and heroic acts ofdetermination by bright children who are unable to take up their places has become the norm. Earlier this year, a girl in Tharaka Nithi made news by walking 50 kilometres to the school she had been admitted. In neighbouring Embu, a boy sought to pay his fees with a cockerel.
Governance
Although the Kenyan government has made progress in putting the 2010 constitution into effect, more work still needs to be done. Many of its provisions have not been implemented, and some in positions of authority have abused it for their personal gain and to the detriment of those it is meant to protect. The Kenya Kwanza Alliance believes that the Constitution of Kenya 2010 is the most important issue on the ballot in this election. Specifically, the choice we have on the ballot is between going forward and finalising its realisation, or going backwards or sideways as the case may be along the lines of the seventy odd BBI ammendments. On which way, the Kenya Kwanza Alliance is unequivocal. We are for completing the implementation of the 2010 constitution, strengthening the rule of law, increasing access to justice, ensuring respect for human rights, and respecting the United Nations Sustainable Development Goal number 16, which focuses on peace, justice, and strong institutions.
Copyright Business Recorder, 2023
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