Nipate
Forum => Kenya Discussion => Topic started by: Empedocles on March 27, 2017, 12:12:58 PM
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Thoughts?
At independence, Kenya was a fairly formal economy. Rules, standards and procedures were well formulated, articulated and judiciously implemented. Our police, just like all other civil servants executed their duties meticulously, zealously guarding the word and spirit of the law.
Our professionals; engineers, architects, doctors, pharmacists, lawyers were all sworn to their code of professional ethics. We had a working template of budding companies that respected their staff. Staff houses, buses, schools and clinics were common place. Public transport was a perfect example of order and our rail system was working. Everybody was sold to the straight and narrow. There was no otherwise.
Clouds gathering:
A story goes that immediately after independence, a group of elders approached our founding father for some favor. Apparently, the very high standards kept the pie out of reach of most citizens. At the time, public transport was under the Kenya Bus Service and KENATCO. These elders sought permission to operate individual public transport vehicles from industrial area-specifically Lunga Lunga to town. Permission was granted and therein, the Matatu culture was officially born in Kenya.
The rain started:
Henceforth, mediocrity and disorder became our second nature. We looked for, found or created shortcuts in every public undertaking to the chagrin of formal operators and the general public. For example, the newly sanctioned Matatu operators had no fixed routes, operated at their convenience mainly during peak hours and were not answerable to any authority on their fares and schedules.
They could withdraw their vehicles from the road anytime they so wished. This was unlike the KBS which had a contract with the City Council to maintain a minimum number of vehicles on the road daily with a fixed travel timetable and routes to service. They also had to start and end their operations within the agreed timelines.
Official Chaos:
Overnight, informal operators sprouted almost in every industry trampling upon the previous players and with it, the known formal standards plummeted to unbelievable levels. The new players were a mockery to investment and a ridicule to standards. Instead of entrepreneurs, we came up with a new one-tenderpreneurs, a polite word for officially sanctioned theft from the government.
Expectedly, the formal operators with their strict adherence to standards and quality could not keep up with the predators. The public service, as we knew it crumbled. One by one, the formal players fell by the wayside. Sugar companies closed shop as sugar barons and uncontrolled imports took over.
The much derided private schools became the new darling. Public hospitals turned into death chambers as the once vibrant railways and KBS went to the dogs. Hawkers invaded the Central Business District.
Our professionals too were infiltrated by quacks. For a small fee, you could get anything from the authorities. Buildings collapsing, lawyers eating their client’s money, doctors procuring abortion at a fee, pharmacists dispensing poison and our honourables seeking treatment abroad became the new norm.
Sustained:
The onslaught on standards and procedures was sustained throughout the Moi regime. The police too soon realized the folly of fidelity to law as lawyers and judges had a party with criminals.
They too joined the bandwagon, brokering justice on the streets and pocketing their cut. The judiciary was up for sale. Unchecked imports by favored individuals took its toll on local manufacturing. KEBS went to the highest bidder and counterfeit took over our markets.
The multinationals, overwhelmed by the many rats nibbling at their market moved their production to friendlier nations. Our industrial area soon turned into an industrial grave yard and our Nation, one big supermarket for Chinese fakes.
One-man guitar:
Under this onslaught, our formal sector began to shrink and with it went formal jobs. Going it alone or one-man guitar became the rave. Even the government was at the forefront of urging our youth to self employ- the rallying call being “Jiajiri”. Everybody became a boss. A one-man Boss.barrow_jack_alltrade
The promoters of this one-man business were of the mistaken opinion that bigger companies would grow out of these outfits. It’s like expecting a rat to grow into an elephant. No amount of feeding, training or coaching or growth can turn a rat into an elephant. May be just an overfed rat.
That’s what we now have in Kenya. These Jua kali companies have only grown into bigger jua-kali companies and not transitioned into big corporates as envisioned.
These organizations have been weaned and fed in disorder. They grew because they were given loopholes. They have no respect for staff, systems and procedures and standards. They excel on patronage and connections and not on product or service quality.
They, for example do not pay formal taxes or keep proper books of accounts. Naturally, they do not need or respect qualified staff as all they need is an owner with the right connections.
The cost:
Our Jua Kali culture has killed decent jobs and with it, quality production. Our youth, do not have the orientation to create systems that can match the global standards of productivity. We cannot compete with organized labor and capital that is employed at the international arena. The efficiencies and economies of scale are simply unmatched. A one-man guitar cannot compete with an orchestra.
International competition is right at our doorstep. We had time and chance to practice and better our game but we squandered it chasing easy money. It is foolhardy to imagine that we can export mediocrity to the global stage. Our JuaKali or Matatu thinking cannot compete at the global stage.
If we cannot enforce our own local standards, someone from outside will. Look at what Uber, the international Taxi hailing app has done to our one-man taxi business. And that’s just a warning shot.
When our local football league proved to be useless, fans easily shifted to the English premier league. KFC is already here with global standards. Woe unto those who still slice up their potatoes with pangas! Carrefour just landed. A quality shop. No industry will be spared the global onslaught.
We have no choice than to think, work and produce like other global citizens. We need more of Safaricom and The Java Coffee Houses. Companies that understand that they are playing at the global stage and benchmark with the best. The one man-heroics will be history. What a price to pay for state nurtured mediocrity!
Evans Majeni is a businessman and a Director at AMM.
http://africanmarketmedia.com/2017/03/25/jua-kali-the-weed-killing-kenyan-formal-economy/
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I'll help you out with tiny historical details. Am travelling so if you will want specifics, they'll wait.
Matatu: It was already happening. Just like the black Taxis in modern European and American cities, people started operating illegally. The penalties were stiff during the colonial era and the law was ruthlessly enforced.
The owners of the matatus were civil servants (the only ones with access to good money). Sometimes they were their own cars (Peugeot 403, 404 etc). Or VW vans bought from mzungu. A driver would be hired to do the matatu thing while boss worked.
The corruption you see in it started way back. Civil servants would speak to the police to let their vehicles pass. A few times they landed in big shit when a mzungu happened to join the kinyasa wearing officers on the beat and one of those illegal taxis turned up. This is what had graduated in to this day when Gen. Ali could run a bus company that was never stopped at any traffic roadblock or any money collected (Crown Buses).
Yes at independence Kenyatta had promised jobs and wealth to the Africans. He soon realized that not every Kenyan could steal land or extort Indian dukawalas. He first lifted the ban on matatus but the licensing and taxation requirements were so stiff that only a few made it. The rest operated illegally with cat and mouse fights with the police and Kanjos.
The delegation you speak of was of Kikuyu "elders". These were mostly MPs, Councillors, businessmen (who had paid to join - no thrills and frills in Central when you are going to see Muthamaki). They requested that the burden be removed from them. Kenyatta decreed (he ruled by unwritten decree) that matatus should not be taxed. They shall only pay road licenses like "other vehicles". The death toll on the roads started rising.
It is true that the removal of any form of regulation brought on the disorder that you see today. I am not so sure that the so called "jobs" could mitigate the levels of crimes such as public rape of women in bus stops.
I am one of those who believe that there are two uniquely Kenyan traits that must be ended forcefully and with brutality if need be:
1. Matatu - Those who want to invest in public transport can do so by buying shares in a National Public Transport Company that would take care of Urban and Rural Transport in Rail, Road, Sea and if possible air. I do not mind specific routes being places on tender but the vehicles shall look the same. They shall meet safety standards with secure seats, etc.
2. Squatters: I believe squatters are land thieves. They should be discouraged. I missed the memo that said every Kenyan must have a piece of land.
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Very true.
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Kenyatta must have been caught between trying to normalize the economy, and hanging onto power. Remember the colonial economy was not designed around benefitting the toiling Negro. I think focus on power won out; especially after a mutiny early in his
misrule. The result is that the colonial economic model has never really changed.
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I'll help you out with tiny historical details. Am travelling so if you will want specifics, they'll wait.
Matatu: It was already happening. Just like the black Taxis in modern European and American cities, people started operating illegally. The penalties were stiff during the colonial era and the law was ruthlessly enforced.
The owners of the matatus were civil servants (the only ones with access to good money). Sometimes they were their own cars (Peugeot 403, 404 etc). Or VW vans bought from mzungu. A driver would be hired to do the matatu thing while boss worked.
The corruption you see in it started way back. Civil servants would speak to the police to let their vehicles pass. A few times they landed in big shit when a mzungu happened to join the kinyasa wearing officers on the beat and one of those illegal taxis turned up. This is what had graduated in to this day when Gen. Ali could run a bus company that was never stopped at any traffic roadblock or any money collected (Crown Buses).
Yes at independence Kenyatta had promised jobs and wealth to the Africans. He soon realized that not every Kenyan could steal land or extort Indian dukawalas. He first lifted the ban on matatus but the licensing and taxation requirements were so stiff that only a few made it. The rest operated illegally with cat and mouse fights with the police and Kanjos.
The delegation you speak of was of Kikuyu "elders". These were mostly MPs, Councillors, businessmen (who had paid to join - no thrills and frills in Central when you are going to see Muthamaki). They requested that the burden be removed from them. Kenyatta decreed (he ruled by unwritten decree) that matatus should not be taxed. They shall only pay road licenses like "other vehicles". The death toll on the roads started rising.
It is true that the removal of any form of regulation brought on the disorder that you see today. I am not so sure that the so called "jobs" could mitigate the levels of crimes such as public rape of women in bus stops.
I am one of those who believe that there are two uniquely Kenyan traits that must be ended forcefully and with brutality if need be:
1. Matatu - Those who want to invest in public transport can do so by buying shares in a National Public Transport Company that would take care of Urban and Rural Transport in Rail, Road, Sea and if possible air. I do not mind specific routes being places on tender but the vehicles shall look the same. They shall meet safety standards with secure seats, etc.
2. Squatters: I believe squatters are land thieves. They should be discouraged. I missed the memo that said every Kenyan must have a piece of land.
I think the author is pointing out how the Matatu culture has permeated our entire economy, where the only businesses which are successful in Kenya are those with the right political connections, regulations be damned.
For example, how many of our "astute" business people (eg. Kirubi) are able to successfully expand their businesses outside Kenya? Aside from buying a couple of residential houses here and there overseas, the majority have yet to spread their core businesses regionally, let alone globally.
That's the result of the matatu culture in our economy, whereby a majority of our leading businesses are only able to operate in a deal-friendly environment.
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Until regulations are passed and enforced, Kenya will continue to be a majority poor state. Korea and the rest of Asia are very organized fast growing economies.