Kenya’s two top cities Nairobi and Mombasa are also the nation’s most unequal in terms of income distribution, according to a newly-released report that has also uncovered the skewed distribution of wealth countrywide.
The Kenya Integrated Household Budget Survey (KIHBS) found that a fifth of Nairobi and Mombasa residents own 86.4 per cent and 78.2 per cent of the wealth, respectively.
In Nairobi, the survey found that 40 per cent of residents at the bottom of the income pyramid control a mere 0.4 per cent of total expenditure, a figure that rises to 2.7 per cent for 60 per cent of the population.
The findings underscore the tough policy choices that Kenya must make to minimise the growing income inequalities whose impact is known to spread beyond the economic sphere.
The survey further found that 60 per cent of Mombasa residents control only 4.7 per cent of resources in the port city.
On average, nearly 60 per cent of Kenya’s wealth is in the hands of a small group at the top of the economic pyramid, who make a fifth of the more than 45.37 million population in 2016. The household budget report is based on feedback from 24,000 households.
The survey found that peri-urban areas have the largest inequality gaps nationally where 60 per cent of residents at the bottom control just 5.7 per cent of the total wealth compared to 29.9 per cent in major cities and towns and 41.5 per cent in rural areas.
“Over space across the 47 counties, the distribution of expenditure by quintiles shows that for all counties that exhibited high poverty rates, the two bottom quintiles control relatively larger shares of expenditure compared to counties depicting relatively lower poverty rates,” the report says.
“On the other hand, counties with significant components of urban population present skewed expenditures in favour of the uppermost quintiles.”
Distribution of wealth in rural areas has, however, improved in the latest survey, which found that 80 per cent of the population controlled 67.4 per cent of the resources in 2016 compared to 47.9 per cent in 2006.
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KNBS’ 2006 survey covered inequality in rural areas only, and did not include Nairobi and Mombasa.
Treasury secretary Henry Rotich said there was an “overall decline” in inequality and a “general improvement” in living standards countrywide over the 10 years through June 2016.
Mr Rotich attributed the improvement to completion of key infrastructure projects worth trillions of shillings, that have created jobs, opened up areas that were largely inaccessible to business and improved living standards.
“Over the last decade, the government invested heavily in key infrastructure such as roads, rail, ports, housing and energy,” Mr Rotich said, adding that investment in social sector, including equipping of hospitals and increased access to maternal healthcare, introduction of cash transfers to the vulnerable through Social Safety Net Programme and increased capitation grant in education sector had helped tilt the scales in favour of the poor.”