Kenya's new law a boon to some counties

As the devolved system of government begins to take shape, it is emerging some counties will record rapid growth because of their strategic positions and abundant resources.

Counties endowed with national parks and game reserves, major towns, mineral deposits or with better infrastructure will see a meteoric rise in economic growth.

“Once they start operating you will see how others will drastically move very fast to great heights of economic growth while some will decline,” says the director-general of the Kenya National Bureau of Statistics, Dr Anthony Kilele,

Whereas the counties will not be allowed to tax residents for service provision, the Constitution allows them to regulate trade developments, which includes markets, trading licenses, fair trading practices, local tourism and cooperative societies.

This, according to Ms Linet Oyugi, an associate economist at Institute of Policy Analysis and Research, will boost counties with resources.

“Some counties with endowments like national parks, game reserves, industries, and mineral deposits will begin from a much advantaged position than others,” said Ms Oyugi.

Narok County, for instance, collects millions of shillings annually from tourists to the Masaai Mara Game Reserve.

Through trade development and regulation, the counties will control the licensing of all businesses within their jurisdiction. This is a big boost to areas with natural resources, some of them marginalised by the central government for many years like West Pokot.

Already mineral resources have been located in different parts of the country, while exploration continues in other areas. Early this week it was announced that large deposits of gold had been found in Migori and Narok County.

Experts say counties like Mombasa, Nairobi, Kisumu, Uasin Gishu, Turkana, Kitui and Isiolo may grow faster given the endowments, agricultural potential and there strategic positioning.

Turkana may even record faster growth due to nascent investments in wind and solar energy, which are touted as sources of energy for the future. The same applies to Garissa, Wajir and Marsabit.

However, Nairobi will remain the richest county, given its strategic position and the scope of investments.

1. Turkana County

About four things come to the minds of many when the name Turkana County is mentioned — Lake Turkana, drought and famine, cattle rustling and Lokichogio, one of the biggest slums in Africa.

However, with the new dispensation, Turkana is among the 10 counties that could experience meteoric growth from their resources.

According to Dr Ekuru Aukot, the director of the Committee of Experts on the Review of the Constitution, the county is strategically positioned for steady growth.

He said with global attention shifting from fossil fuels to clean, renewable and cheaper sources of power like wind and solar, the future of Turkana as a producer was a reality.

“We have very strong winds in the county that can propel it into a main source of energy, not to mention the solar energy,” said Dr Aukot.

The county is the largest in terms of size, covering 77,000 kilometres. It has a population of over 865,000 thought the figure was questioned and a repeat count has been ordered.

With a 85 per cent of livestock in Kenya being found in the arid and semi-arid lands, with Turkana being the bigger part of these areas, Dr Aukot said setting up abattoirs would give the county a big boost.

The forthcoming Sudan referendum will likely turn the county a frontier zone.

Southern Sudan, with multi-billion reconstruction projects, provides an avenue for the county to be an exit and entry point for the two countries.

Turkana Central MP Ekwee Ethuro said the fact that the county would be an entry point to Southern Sudan will change its fortunes.
Mr Ethuro said fish resources in Lake Turkana had not been fully exploited.

“Lake Turkana is the largest fresh water lake in the country and has a capacity of Sh17 billion per year, and this is what we will seek to exploit,” said Mr Ethuro.

He said the county had gold, gypsum and lime deposits while exploration for oil was in progress.

The MP said with devolution, better veterinary services will be available because the county will be able to employ qualified vets.
He said an abattoir built by World Vision required only Sh100 million to become operational.

“With Lake Turkana, our unexploited mineral deposits, petroleum exploration, livestock and being the window to Southern Sudan, we are home and dry as a county,” said Mr Ethuro.

2. Kakamega County

It has been billed the “Rainbow” county because of its strategic location in a region endowed with natural resources and enormous potential for agricultural production.

Some liken Kakamega County to a giant finally awakening from a long slumber to unlock its potential after years of inertia.

The county stands out for two reasons: its expansive size, covering nine constituencies, and a large population of 1.6 million people.

The two factors, it is argued, could provide the impetus to stir economic growth and reverse the high poverty levels ravaging communities in the region.

Constituencies in the county include Lugari, Malava, Shinyalu, Lurambi and Ikolomani. The rest are Mumias, Matungu, Khwisero and Butere.

The unexploited potential for agricultural production and the untapped western tourist circuit are expected to be a major catalyst for economic growth. They set the right climate for investors.

Fresh prospecting for gold and other minerals by international firms is going on in Shinyalu and other parts of the county.

If the firms stumble on substantial amounts of minerals in their hunt, that could add to the glitter of a promising future in terms of revenue for those living in the county.

A shift from subsistence farming practised by many rural families could help uplift incomes and address perennial food shortages.

Prof Egara Kabaji, the director of Communication and Publishing at Masinde Muliro University, says the county has a promising and bright future because of the vast resources and wealth in human capital.

“Kakamega is a perfect example of a Rainbow County in the sense that it stands out in its uniqueness in terms of its physical location and because it has embraced communities from different parts of the country and opened up its doors to investment opportunities,” said Prof Kabaji.

The university don said all leaders from the county should mobilise local residents to take advantage of the opportunities for agricultural production to improve their livelihoods.

Masinde Muliro University has had a major impact on the economic growth of Kakamega in the last five years, setting off a scramble to the town by investors.

According to the university’s deputy vice-chancellor in charge of Finance and Administration, Prof Sibilikhe Makhanu, Sh700 million is released into the region’s economy annually because of activities taking place at the institution.

Prof Kabaji said despite the small sizes of land, communities in the county could take advantage of the fertility of the soils to move into horticultural production instead of relying on subsistence farming for their livelihoods.

He said introduction of cottage industries in rural villages should serve as major catalyst to drive economic growth in the county.

3. Kisumu County

Growth will be hinged on the revamped airport and the Lake Victoria transport system.

The expansion of the airport has pushed up property prices, with speculators cashing in on the demand for land. New housing units are also coming up around the facility.

The county could also reap big from the opportunities presented by the East African free trade regime to become a regional economic hub. Already, the Lake Victoria Basin Commission, an organ of the East Africa Community, is building an office complex and residential houses for its in the town.

The county hosts three sugar millers; Muhoroni, Chemelil and Kibos.

“All we need is a clear strategy aimed at making things work. From sugarcane we can get power, ethanol and sugar whose returns can be beneficial both as taxes and as income to the people employed by the sector,” says Kibos managing director Raju Chanan.

Then there is the Ahero rice fields, whose potential has not been exploited for many years.

The area also boasts several tourist attractions which could rake in million of shillings if properly marketed.

Lake Basin Development Authority Managing Director Joseph Kahemba says fish processing factories that were operating below par would be revived when the fish ponds in the constituencies take off.

4. Nyeri County

Nyeri County is endowed with both a skilled human and natural resource base that could boost its economy if well-exploited.

Sandwiched between Mt Kenya and the Aberdare ranges, tourism and agriculture can be the main drivers of its economy if their potential is well-harnessed.

Revamping of coffee farming would particularly assure the county of a good stream of foreign exchange.

This could be the main agent of change since the majority of households have coffee plants.

There are about 63,000 active small-scale farmers and 220 coffee farmers. Despite the odds in the industry, the smallholder growers had a collective turnover of Sh1.1 billion in 2008, an indication that coffee can drive the local economy.

Generally, Nyeri has good roads and plenty of water, which would support value addition on coffee through processing, says Mt Kenya Tourism Circuit Association chief executive officer Simon Wachira.

The favourable climate, the breath-taking beauty of the two mountains with two national parks and the proximity to Nairobi city also make the county apt for conference and adventure tourism.

To add to its revenue, the county could rope in the many tourists who visit several private ranches located within it without paying the necessary taxes to the government.

5. Kitui County

Key resources in Kitui have set off excited discussions on fighting poverty in the region.

The arid county boasts huge deposits of minerals, two rivers, a globally renowned national park, two vast game reserves and four public institutions of higher learning.

High quality coal ideal for power generation, limestone and gypsum used in cement making and iron ore are plentiful in the county’s six constituencies

Local leaders said if the vast mineral and tourism resources were properly managed, Kitui could become Kenya’s richest county.
Consultations are already in top gear among elected leaders, professionals and the business community to establish a think tank to formulate a development master plan.

MPs David Musila (Mwingi South), Isaac Muoki (Kitui South) and Charles Nyamai (Kitui West) said Kitui had the potential to emerge as one of the most vibrant regions if its vast mineral wealth and tourism resources were fully exploited.

They hinted, in separate interviews that Vice President Kalonzo Musyoka will this month convene a meeting in Kitui town to discuss the county’s economic agenda.

“We’re keen to form an advisory team to develop an economic blueprint that will attract foreign and local investors,” said Mr Muoki.
Mr Muoki said if properly exploited, South Kitui game reserve, Kora national reserve and Tsavo East National Park could deliver the local community from poverty.

The Government this week invited international mining firms to exploit coal deposits in the Mui basin.

Larfarge, the French cement conglomerate plans to invest in a multi-billion plant in Kitui though its local subsidiary, Bamburi cement.
Other investors who have so far expressed interest are Devki Steel and Athi River Mining, who want to set up cement and steel manufacturing factories, respectively.

The Defense Assistant minister says thousands of jobs will be created by various sectors once the county becomes operational and that they will set aside land as capital for investment purposes.

“It is upon us as the leaders of this county to think of how these natural resources will transform our county to self reliance status and make it the richest in the republic,” Mr Musila said.

6. Mombasa County

For Mombasa County, a mixture of nature, hospitality and its geographical position as the gateway to the East and Central African region make it potentially one of the richest in the country.

Tourism minister Najib Balala said the diversification of tourism products means that many counties will earn substantial revenue from the sector.

The minister sees Mombasa turning out to be a very powerful county given the presence of resources such as the port, ferries and vast tourist attractions that could make commerce vibrant and attract investment.

The biggest challenge, Mr Balala said, was that Mombasa had overgrown its traditional sources of revenue and needs to think outside the box.

“It’s only counties like Kwale, Kilifi, Lamu and Tana River that should now take up the challenge to develop their tourism packages.

“Areas like Kipini in Tana Delta and Taita Taveta are the ones that should now be focusing on reorganising themselves to tap into the safari and wildlife segment of attraction while Mombasa should be looking into ways of coming up with a major international conference centre,” he said.

An economist who also runs a freight logistics business in Mombasa, Mr Salim Nassib Mbarak, said Mombasa’s position is strategic, especially with major facilities such as the port and oil refinery, and economic activities such as fishing, cement manufacturing and tourism.

7. Mandera County

Mandera County sits on the horn of the county, near the Horn of Africa, and borders Ethiopia and Somalia.

The county, whose population was found wanting due to its unscientific growth, will offer the country the connection to the larger Ethiopian market, which is set to use the Lamu port once it is operational.

The district has a population of 250,372 (1999 census). It has three constituencies: Mandera Central, Mandera West and Mandera East.

For its tourism it has the Malka Mari National Park.

According to the former Mandera Central MP, Mr Billow Kerrow, the county has a lot of potential owing to its strategic position of bordering two countries.

Mr Kerrow said business along the borders with Ethiopia and Somalia was good and could be enhanced to spur development.

The county borders two districts in Ethiopia, Dolo and Situ. It also borders Gedo District on the Somalian side.

The former Mandera Central MP said the county was endowed with a lot of mineral deposits, most of them not yet explored.

Currently, petroleum exploration is going on in the Mandera-Lugh Basin. If the petroleum is found it might turn the fortunes of the county.

8. Isiolo County

The Vision 2030 wants to build an Isiolo Resort City, modelled on South Africa’s Sun City. the expansive project will comprise casinos, golf courses, restaurants and discotheques.

The nucleus town will also boast residential housing facilities, a hospital, schools, shopping malls, a police post, and a fertilizer processing plant.

Located at the centre of the country, Isiolo is the border line between the central highlands and the arid zones of northern Kenya. Its unique location and attractive sceneries made the government to identify it as one of the leisure cities planned to be developed in line with vision 2030.

Isiolo south MP Abdibahari Ali says the presence of three national reserves and tourist lodges, favourable weather and ongoing infrastructural development will woo tourists and investors to the county.

He says the county has enormous untapped resources which, if properly managed, will spur economic development and make it the second richest county after Narok

Isiolo North MP Mohamed Kuti says the first phase of Isiolo-Moyale highway scheduled to be completed by the end of 2010 will spur growth.