Ndii finally understand corruption

[Kim Jong-Un's Pajama Pants]

True, but of late Chile has been rocked with civil protests. The gap between the rich and the poor is enormous. The people have pushed through a new constituition and this could bring some change away from the old constituition placed by the military dictatorship.

Chile economy is freest in Latin america https://www.heritage.org/index/ranking . There's direct correlation between economic freedom, corruption and GDP per capita . There's no shortcut to economic growth, a country has produce goods or provision of service either for local or export market and preferably for both markets.

What goods does kenya produce for export besides agricultural produce? What's kenya's competitive advantage? i.e. what can it make for export that other countries can't make at a competitive price? bottomsup doesn't mention production and it's why I think Ndii is a typical theoretical academic. How will Africans become rich when they make nothing?

I am partial to this view.  They can make shit that people want bad enough both at home and abroad.  Or they can extract maximum value from their raw materials - they can't because Africans are split into little fiefdoms(with flag, anthem and 21 gun salutes that make their chests swell with pride) that were purposed for the benefit of Europe.

[RV Pundit]

One thing people don't realize is that Africa is Pre-Industrial society. It simply has no history of making stuff. India, China, Europeans even before the advent of industrializations (powered machinery) were making things.

For these societies - they already had history of making things - they have the crasfmanship to make these stuff manually - and what manufacturing does for them is to speed up the process up or to scale it.

Now poor Africa has no such history, no such craftsmanship, and therefore it will take them before we embrace manufacturing fully - maybe another two generations.

This stuff China were making in 11th Century. The little African were doing is maybe pottery, making rudimentary weapons, and least of all weaving clothes...

[hk]

I think we should keep it simple and stupid - we have problems - we solve those problems.
So what are our problems.

1) Food insecurity - we grow more food - we improve productivity in both farming and livestock keeping. That will employ maybe 8 million of farmers - and this we can only do by improving fertilizer applications plus quality seed plus vet services plus feedlots - through cheap credit lower than commercial banks and without predatory lending.

Ndii and I agree here - we need to set up a fund for this - and after initial capital injection say of 50B - this will not need further injection as farmers will repay the loan.

2) We have problem with infrastructure - we have slums, poor roads, pave walk - Kazi Mtaani type to clean up our streets - find a way to inject money into housing - and we can keep millions of kenyans employed as watu wa mjengo - working as Kazi mtaani.

3) Let us not solve problems that don't exist in our country - like the need to export or manufacture or make things? What for? Let us provide jobs to unemployed to solve real problems that are within realms of gov....like employing them to build roads using labour intensive projects

Gov job is not to make things. It's to provide services - and hopefully private sector can organically grow - and export goods - whatever that maybe.

https://wits.worldbank.org/CountryProfile/en/KEN Kenya needs to produce and consume more. The low hanging fruit is increase in agricultural productivity. Textile export were $700m , Bangladesh comparative advantage in textile is cheap labour. Just like Bangladesh, kenya cheap labour is deployed in the cut flower industry.  That cheap labour starts earning then start buying stuff and a market develops. 

And how is this any different from what jubilee has been doing?
Hunger is an issue of poverty and distribution, so focusing on food insecurity is completely misplaced.  Question how come after Ruto fertilizer subsidy agricultural productivity didn't increase? Basically you propose the usual tax,borrow and spend policy of jubilee.
To increase productivity in agriculture we just need better utilization of what already there. Take livestock, a simple thing like planting fodder for the pastoralist and better semen would more than double productivity of the livestock industry. Or better yet a cooperation between farming counties (e.g nyandarua, tranzoia ) and  pastoral counties( baringo or west pokot) Farming counties sell fodder and pastoral counties sell manure( manure increases productivity of farming counties). Basically a solution that's market driven not another government slush fund. 

[RV Pundit]

But surely the gov hands are tied. It cannot collect manure, sell it to farmers, and then collect hay, and distribute to pastoralist. This is upon citizens to do it.

What can gov do that can scale up quickly to cause huge impact on millions of farmers?

For me it simple - REDISTRIBUTE MONEY from taxes back to deserving sectors - Anything else become too complicated to executed.

Gov should avoid going into operations - it should provide money and the rules for getting that money.

The last fertilizer subsidy was a mess because it was being distributed by chiefs, cereal boards and was given for free - many of fertilizers ended up being re-sold in Uganda.

SO the solution is simple - recreate KFA (nationalize the current one) or create Kilimo Bank - start offering loans through cooperatives or even individuals - and these loans should be in form of farm inputs (AVOID GIVING POOR ILLETERATE PEOPLE CASH).

This is what used to happen with KGGCU/KFA - and at least in our place - people were doing serious commercial farming - because all you needed to worry about is tilling the land. Then you go to nearest KFA - collect quality seeds and ferilizers - then you wait and harvest - deliver the Maize to NCPBB - the only risk was drought - but now we have crop insurance.

Otherwise on a good year, people would harvest, get loan deducted, pay schools fees, buy a pickup or tractor, go to Mombasa for a week, and enjoy live....farming was actually very profitable

It is what is happening in KTDA - KTDA basically gives fertilizers - then substract from the feed.

Nigeria is doing the same with ANCHOR LOAN - and they are achieving great results if Buhari data is to be believed.

The good thing is once you inject SEED capital - then it's over - the fund can revolve - with small injection every year.

Why do we need a new bank - because the existing banks - can never fill that gap as long as they are profit driven.

We know have Development Bank of Kenya - merged from dead banks - that can finance SMES.

We have Mortagage Refinancing - that will unlock housing sectors.

So we already have the foundation - it just need to be executed.

As for manufacturing - I think that should be left to private sector - gov should just work on building EPZ zones - or Special economic zones - and provide as competitive micro-enviroment for export led manufacturing as possible - subsidized power, zero taxes - in exchange of mass employment and exports.

General incentivize for entire private sector would be very expensive -  and self-defeatist - why collect taxes in first place then send it back to everyone? - gov has to target certain sectors and use the taxes there - everyone else should expect good roads, clean piped water, railways, ports and such critical enablers - as reward for their taxes.

And how is this any different from what jubilee has been doing?
Hunger is an issue of poverty and distribution, so focusing on food insecurity is completely misplaced.  Question how come after Ruto fertilizer subsidy agricultural productivity didn't increase? Basically you propose the usual tax,borrow and spend policy of jubilee.
To increase productivity in agriculture we just need better utilization of what already there. Take livestock, a simple thing like planting fodder for the pastoralist and better semen would more than double productivity of the livestock industry. Or better yet a cooperation between farming counties (e.g nyandarua, tranzoia ) and  pastoral counties( baringo or west pokot) Farming counties sell fodder and pastoral counties sell manure( manure increases productivity of farming counties). Basically a solution that's market driven not another government slush fund. 

[Kadudu]

So according to the Hosola gospel this will be the way our kids will grow up after 2022.

[hk]

But surely the gov hands are tied. It cannot collect manure, sell it to farmers, and then collect hay, and distribute to pastoralist. This is upon citizens to do it.

What can gov do that can scale up quickly to cause huge impact on millions of farmers?

For me it simple - REDISTRIBUTE MONEY from taxes back to deserving sectors - Anything else become too complicated to executed.

Gov should avoid going into operations - it should provide money and the rules for getting that money.

The last fertilizer subsidy was a mess because it was being distributed by chiefs, cereal boards and was given for free - many of fertilizers ended up being re-sold in Uganda.

SO the solution is simple - recreate KFA (nationalize the current one) or create Kilimo Bank - start offering loans through cooperatives or even individuals - and these loans should be in form of farm inputs (AVOID GIVING POOR ILLETERATE PEOPLE CASH).

This is what used to happen with KGGCU/KFA - and at least in our place - people were doing serious commercial farming - because all you needed to worry about is tilling the land. Then you go to nearest KFA - collect quality seeds and ferilizers - then you wait and harvest - deliver the Maize to NCPBB - the only risk was drought - but now we have crop insurance.

Otherwise on a good year, people would harvest, get loan deducted, pay schools fees, buy a pickup or tractor, go to Mombasa for a week, and enjoy live....farming was actually very profitable

It is what is happening in KTDA - KTDA basically gives fertilizers - then substract from the feed.

Nigeria is doing the same with ANCHOR LOAN - and they are achieving great results if Buhari data is to be believed.

The good thing is once you inject SEED capital - then it's over - the fund can revolve - with small injection every year.

Why do we need a new bank - because the existing banks - can never fill that gap as long as they are profit driven.

We know have Development Bank of Kenya - merged from dead banks - that can finance SMES.

We have Mortagage Refinancing - that will unlock housing sectors.

So we already have the foundation - it just need to be executed.

As for manufacturing - I think that should be left to private sector - gov should just work on building EPZ zones - or Special economic zones - and provide as competitive micro-enviroment for export led manufacturing as possible - subsidized power, zero taxes - in exchange of mass employment and exports.

General incentivize for entire private sector would be very expensive -  and self-defeatist - why collect taxes in first place then send it back to everyone? - gov has to target certain sectors and use the taxes there - everyone else should expect good roads, clean piped water, railways, ports and such critical enablers - as reward for their taxes.

And how is this any different from what jubilee has been doing?
Hunger is an issue of poverty and distribution, so focusing on food insecurity is completely misplaced.  Question how come after Ruto fertilizer subsidy agricultural productivity didn't increase? Basically you propose the usual tax,borrow and spend policy of jubilee.
To increase productivity in agriculture we just need better utilization of what already there. Take livestock, a simple thing like planting fodder for the pastoralist and better semen would more than double productivity of the livestock industry. Or better yet a cooperation between farming counties (e.g nyandarua, tranzoia ) and  pastoral counties( baringo or west pokot) Farming counties sell fodder and pastoral counties sell manure( manure increases productivity of farming counties). Basically a solution that's market driven not another government slush fund. 

The point is to get farmers to do that get them started, kick start. Kitui they're offering transportation of livestock to markets with very minimal investment and the service isn't free. Even better farmers can organize themselves to buy fodder or manure. Before the advent of dairy industry there was no market for hay in central kenya, now there's a large market for it. The point is once a market is created for what  farmers are already producing increase in productivity normally follows. There's no magic wand to increase productivity for million of farmers all at once.
 There was no time farming was profitable cause of KFA/KGGCU/ NCPBB, the farmers were and  are still are pampered, protected and subsidized by the public.
More government involvement in agriculture would be to the detriment of the sector.

[RV Pundit]

This false. Kenya gov inherited working institution built by British settlers- the Delameres built KCC, KFA, Kenya seeds and agricultural institutions that made dairy and cereal production profitable.

Enter Zimbwabwe...African political fatcats takes over farms.

Along the way - as the new political farmers who had grabbed the brits farms got into failed telephone prestige farming (Zim style) - in late 80s and 90s - they started interfering with these solid institutions to put their cronies in and make money from corrupting these farming institutions - and productivity went down - and farming became unprofitable- these institution started dying. World bank/IMF SAP was the last nail on coffin for others like cotton.

Only KTDA survived...and has become a model of small holder farming in the world.Coffee did well until it started dying in 1990s. Even the beef industry that use to export to EU market - died.

Out of the chaos - emerged horticulture and flower industry - largely outside gov armpits - and that has been the silver linning. Kibaki resurrected the dairy sector...and that is pretty good.

How can we go back to 1960s? Cooperative led farmer institutions - that have synergy btw large and small holder farming?

For me I would go for gov owned Farmers Bank (KFA) - that give loans in farm inputs or cash  - to farmers owned cooperatives - that tend manage farmers and cooperatives. More like the Matatu SACCO model.

This will apply for farmers, matatus, hawkers, boda boda.

Gov should deal with SACCOS - the Saccos can deal with members. We have succesfully cooperative bank model - but now it's gone into commercial lending and all that.

So we need COOP that offers low interest loans. This is why Ethiopia has refused to privatize their banking sector. Meles Zenawi argued they would offer predatory loans and make situation worse...like we now have in kenya...where 14m people are listed in CRB.

Gov should sell it shares in KCBS and COOP - name them - start a Hustlers Bank - that will only lend to cooperatives (SACCOS) - who must then lend it to it's members. Gov can put conditions like you can only lend farm inputs or boda boda or asset financing for matatus or salon.

The same for housing - Kenya Mortgage refinancing - should lend to lenders - to ensure mortages are cheap as long as house is affordable (not luxury) - and developers do not resort to expensive punitive bank loans.

As for the rest of us (NON Hustlers) - the systems is not broken - it works. It's broken for the poor. For the rich and middle class Kenya is MARWA as Luo would say.

The point is to get farmers to do that get them started, kick start. Kitui they're offering transportation of livestock to markets with very minimal investment and the service isn't free. Even better farmers can organize themselves to buy fodder or manure. Before the advent of dairy industry there was no market for hay in central kenya, now there's a large market for it. The point is once a market is created for what  farmers are already producing increase in productivity normally follows. There's no magic wand to increase productivity for million of farmers all at once.
 There was no time farming was profitable cause of KFA/KGGCU/ NCPBB, the farmers were and  are still are pampered, protected and subsidized by the public.
More government involvement in agriculture would be to the detriment of the sector.

[sema]

One thing people don't realize is that Africa is Pre-Industrial society. It simply has no history of making stuff. India, China, Europeans even before the advent of industrializations (powered machinery) were making things.

For these societies - they already had history of making things - they have the crasfmanship to make these stuff manually - and what manufacturing does for them is to speed up the process up or to scale it.

Now poor Africa has no such history, no such craftsmanship, and therefore it will take them before we embrace manufacturing fully - maybe another two generations.

This stuff China were making in 11th Century. The little African were doing is maybe pottery, making rudimentary weapons, and least of all weaving clothes...

But this is my point -- without production, there's simply no way to become a richer nation. Kenya and all of sub-saharan Africa will remain poor, 3rd world economies dependent on typical 3rd world industries like tourism, agriculture and drugs/money laundering. Bottoms up is a tooth fairy since it doesn't mention production.

[RV Pundit]

BUE manifesto is yet to be released. Raila wants to copy-paste it. So wait a little longer. Ndii and others are working on it.

But this is my point -- without production, there's simply no way to become a richer nation. Kenya and all of sub-saharan Africa will remain poor, 3rd world economies dependent on typical 3rd world industries like tourism, agriculture and drugs/money laundering. Bottoms up is a tooth fairy since it doesn't mention production.