Vision forestalls war and keeps economy steady

It’s said a growing economy is evidence of a society that has got its act together. It happens in a society that is doing the “right things right”. This means resources are better deployed. Energies are better directed. It also means people are mastering techniques of doing things. They are also improving on these techniques.

A growing economy therefore is not just about making money. It is about finding use for that money. It is also about making sure everyone is benefiting from the money.

A growing economy should also lead to improvement in the wellbeing of the ordinary people. If this growth does not lead to better lives, then the growth is not real. Some may even say that the growth is “fake” because they cannot see anything in their pockets. In other words, there can be growth without development. There can be growth without changes in people’s wellbeing. This happens when governments pump resources in “white elephant” projects. These are big projects without productivity.

What bothers many observers on Kenya is why the country experiences erratic growths around election time. From the early 1990s, growth rate declines around election time. Growth begins to accelerate almost six month after an election. It remains steady for another three or four years before beginning on a downward spiral again.

CONSTITUTION'S ADOPTION

This pattern of “stop-go” growth began to change after adopting the Constitution of Kenya 2010. Growth did not decline in 2012 although preparations and fears that accompany elections were beginning to build. The country held the March 2013 General Election with growth rate of above 4.5 per cent. The rate of growth did not decline even after the election. Neither has the rate of growth declined since then.

Of course drought will affect the economy this year because our agriculture is rain fed. For fifty years we have failed to have successful agricultural irrigation projects. We had successful projects in the 1970s but we have “eaten” them all.

But there is some luck somewhere. The effects of the drought will be compensated by growth arising from programmes under devolution. There are many development initiatives the county governments carried out in the early period of devolution in 2013/14. These are making local economies active and productive.

But if the elections continue causing conflicts, as is evident in some of the counties, growth will slow down. Development programmes will also stop awaiting anxieties to end. As is usual labour migrants will withdraw from farms as they move to areas where their ethnic communities are more. They will move to where they feel secure because of the number of members of their group. Combined, drought, temporary withdrawal of agricultural labour from areas where there is local violence, and general anxiety over elections, will have some effect on the economy.

THE MAJORITY

There are other countries that experience this erratic form of growth. The majority of African countries are cursed in this respect. They do not sustain growth for a long period. But in some of these countries such as Zambia, Uganda, Malawi, and Namibia growth does not decline because of elections.

Growth declines because the leadership in these countries lacks long-term vision. The leaders are often interested in short-term interests. And where leaders remain in office for only two terms, another group of “short-term vision” leaders step in the moment they leave office.

However, elections and political competition, more than anything else, is responsible for erratic growth rates. It is elections and the short-term visioning of rival political leaders that leads to this.

Some countries have remarkably got out of this trap. Mauritius, Botswana, Rwanda, Ghana and even Tanzania are good examples. Some of them such as Botswana have had steady growth rates for many years. Others such as Ghana and Tanzania have started having steady and stable rates of growth in recent times. Outside Africa, India and Argentina are examples of countries that used to have erratic growth. They now are characterised by steady growth rates. The same with East Asian countries such as Malaysia and Indonesia. What then have these countries done differently to maintain steady growth rate? What does Kenya do wrong to have erratic growth and how can this be avoided?

A COMMITMENT

Those that do well do so because the leadership has a commitment to a long-term vision. Rival parties and competing groups are persuaded to pursue a common blueprint. They commit to pursue inclusive growth and development. In fact, they even compete in getting the most flowery language about how they will maintain the vision.

In Kenya, rivalry among leaders prevents them from having a national dialogue on Kenya’s future. The rival parties do not bother to commit to a dialogue on the future vision of the country. The opportunities to dialogue on the future development are usually lost in deafening alarming quarrels. All we know is manifestoes have pictures and other images of what they want the country to look like.

Two, all countries that succeed in maintaining steady growths have evidence of development whose benefits reach all groups and corners of their countries. Growth is associated with benefits that are distributed to all people. This distribution does not mean income in people’s pockets. It means the well-being of all in terms of health, livelihood and food security is improved. It also means no pocket of the country is left “untouched”. And no one pleads for development; it is just guaranteed.

UNFORTUNATE COUNTIES

We have the unfortunate counties in the northern part of the country. Turkana, Marsabit, and others in the north have remained in the margins of development even when we have had moments of steady growth. Our growth even the short moments when it is not erratic, does not reach them. We have not had programmes for them.

The Constitution provides for equalisation fund to help them catch up. But they also have a problem. They have not debated and developed a long-term vision for the county. Their local elites are as interested in eating as those who preceded them. All the same, the national development vision would have these areas as part of the thinking in “inclusive development agenda”.

These countries where growth is steady and the leadership is committed to long-term vision have another important attribute. The law and courts work with high level of prediction. The law is applied in a just manner. The courts function without favouring any person or institution.

Commitments to the law and having properly functioning institutions have one consequence. They enable investors, local and foreign, to have confidence in the institutions of justice. Everyone knows a contract is enforced to the letter without favour. An agreement is an agreement that is not changed by political considerations.

SOCIAL NORMS

And if these institutions do not function as they should, social norms and values play the role of committing everyone to their bargains and the agreements. People trust the country when they know that everyone will keep to their side of the agreement and the bargain they obtain.

These values lack in the country. One has got to review cases in the commercial court to see how values lack in conduct of business. Those who keep to their side of agreements are notably few. Some commit to agree to a particular bargain only to change their mind in the course of business transaction. This certainly affects the investment environment.

The economy generally suffers when institutions are not effective. The economy cannot grow when norms and values undermine the adherence to principle of integrity. Of course this is one problem where courts and effective law enforcement efforts can correct with great ease.

The civil service plays an important role in growth of economy and development but this role is sometimes ignored because of our love to see the hand of politics. But the public service plays an important part in implementation of policies the leaders have committed to. Once the polies are in place, it is the responsibility of the bureaucrats to get them working.

STEADY GROWTH

In countries where leaders have maintained steady economic growth and development for a many years, the government bureaucrats are professionals and competent. They are recruited on basis of merit. Each person is promoted on basis of merit and not “name-dropping” or his or her ethnic place of origin.

The government also invests in provision of quality education and other services. This ensures that the country has adequate staff with quality skills to support national development. But they must also be competent enough to keep off political interests from interfering with long-term vision. This ability to cover themselves from short interest is dependent on how they are recruited.

There is no doubt that Kenya has a highly competent public service. In fact, we have one of the best in Africa. Highly competent, well educated, and well resourced. But why do we continue having erratic growth and levels of development if we have a highly skilled and competent public service? Is it that we do the right things but do them badly? Is it that we have allowed short-term electoral interests to affect how we do things?

Prof Karuti Kanyinga is based at the Institute for Development Studies at the University of Nairobi.

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