Four lessons from the publication of the County Gross Product

Friday February 15 2019

By KWAME OWINO
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The Kenya National Bureau of Statistics (KNBS) published a report containing estimates of the output from individual counties in Kenya. The Gross County Product (GCP) 2019 report measures the size of counties in terms of the aggregate economic output in the geographical area.

The publication makes revelations that demand careful dissection for lessons for households, public administrators and firms in Kenya.

In spite of the fact that it is replete with data and charts, the KNBS managed to condense it into 50 pages of information and top-line analysis. Conscious that extracting insights requires a more concentrated review and triangulation with other data, my first impressions are distilled into four insights below.

FUNDING

First, the report is highly valued by policy audiences and institutions outside the public sector. The preparation and execution of a project of this kind required considerable resources and contributions from the World Bank and six governments including the UK, Denmark, Sweden, Finland, the US and the European Union. This picture reveals the political economy of data production in Kenya, which is skewed by the inadequate attention that parliament and the executive branches of government pay to KNBS.

It is evident that the KNBS does not receive sufficient resources to collect and publish information about the country, hence to receive support and confidence of bilateral and multilateral institutions for this publication is commendable.

In this budget formulation season, parliament should answer why it allocates KNBS the equivalent of Shs150 per Kenyan for all operations. Inadequate funding for collection and publication of information demonstrates that the fiscal choices by the executive and parliament inhibit the right of Kenyans to receive information and also constrains the KNBS from collecting data on many other critical issues more regularly.

EYE-OPENER

The second fact that emerged from the publication of the GCP is a consequence of the finding on limited resources to KNBS. One of the advantages of the KNBS data is that disclosures are usually available to the public even if occasional delays occur owing to the need to jump bureaucratic loops.

Publication of the GCP reminded me of the pathetic state of ''economic literacy'' in Kenya. Kenyans are engaged in public discourse and often make claims about the size of the economy, counties and sectors based entirely on intuition and the claims of politicians who believe that some regions are the exclusive drivers of Kenya’s economic growth. This fallacy carries over when elections come when every Kenyan is reminded to align to incumbent parties so that development will be distributed to friendly regions and people.

GCP 2019 shows that incomes in Kenya are not as tightly-aligned to ethnicity as many political pundits and regional political groups claim. With greater disclosures, these claims can be examined without biased lenses as many are used to. It is not the duty of the KNBS to make political or regional configurations to change their minds but at least there’s information for those who wish to debate sensibly to do so.

GOING URBAN

Thirdly, Kenya has a legacy of “posh and serious” pundits who dwell in urban areas but continue to preach the pristine beauty and superiority of rural life. When I and colleagues put together the information of the share of counties in Kenya’s overall income totals (Table 3.1) against the real county income per person (Table 3.7), it is clear that the posh and serious are trying to corner urban level prosperity for themselves while distracting youth and other poorer individuals to remain in the countryside.

If the complex data could be described in a phrase, it is that the future of Kenya lies in its cities and cosmopolitan areas. For instance, the six largest urban areas by population density are all in the top 10 most prosperous areas measured by income per person.

Also evident is that the total land endowment per county is not a big driver of income per person, suggesting that land use is not efficient in most rural areas. Kenya’s posh and serious are proven masters of public discourse devoid of facts.

REVENUE POLICY

The final impression is that county governments are being placed under tacit pressure to use the GCP data to design revenue policy. This is worrisome because the discourse is led by unproven claim that county governments must, by necessity, raise more resources and rely much less on equitable share of revenue collected by agencies at the national level. The Council of Governors ought to see the data as essential guides to planning policy but resist the narrative that is driven by the pressures of debt overhang for counties to ramp up taxation rates in their regions.

Kwame Owino is the chief executive officer of the Institute of Economic Affairs (IEA-Kenya), a public policy think tank based in Nairobi.

Twitter: @IEAKwame