In the wake of the arms fraud on February 13, 2020, Kenya risks sliding into Mafia capitalism. Despite enchantments of the “Africa rising”, the continent is newest frontier of a new global capitalism: Mafia capitalism as a new, totally unregulated and unscrupulous form of capitalism, mired in dirty money.
As an operational concept, mafia capitalism came into vogue after the collapse of the Soviet Union and the eastern bloc amid a growing number of companies and gangs involved in drug-dealing and trafficking young women to work as sex slaves, weapons, immigrants and counterfeit goods, corruption and cyber crime syndicates in Western democracies.
Arms deals in Africa’s emerging markets heralds the age of Mafia capitalism. It all started in South Africa, with the “Arms Deal”, a military procurement in 1998-1999 that involved a US$4.8 billion purchase of weaponry tainted with repeated, and seemingly substantive, allegations of corruption.
In Nigeria, an arms procurement deal between December 2014 and May 2015 resulted in the embezzlement of $2 billion. And in February 13, 2020, Kenyans were struck mute by the news of $400 million (Sh 40 billion) fake arms scandal involving former Sports Cabinet Secretary, Rashid Echesa, and which has tragically sucked in Deputy President William Ruto whose Office on the second floor of Harambee House Annex in Nairobi is the crime scene where the fake contract for the supply of military equipment was signed.
For long, East Africa’s most robust economy has been a source and transit area for global Mafia capitalism. In the year 2018/19 the Ethics and anti-corruption Commission (EACC) received and processed a total of 9,303 complaints and 571 reports on ethical breaches. In the same vein, the State of the Judiciary and the Administration of Justice Annual Report, 2018 – 2019 reveals a country stalked by home-grown mafia barons operating with total impunity.
Three categories of dangerous cases are on the rise in Kenya. First are dangerous drugs cases, which have increased from 5565 cases in 2017 to 8,021 in 2018. The second are economic crimes which increased from 3,503 in 2016 to 4,100 in 2018.
Third are cases categorized as “corruption” while shot from 92 in 2016 to 119 in 2018. A total of 58 cases were filed in the Milimani Anticorruption Court in 2018/19 financial year, with 44 cases resolved by the end of 2019.
Three cases of corruption stand out and signify the threat of mafia capitalism. On March 2019, President Uhuru Kenyatta sacked Echesa reportedly due to possible links with a criminal enterprise behind the $320 million fake currency seizure in Ruiru, Kiambu county on February 28, 2019.
In July 2019, 27 Kenyan officials, including the Finance Minister Henry Rotich and the treasury Principal Secretary Kamau Thugge, were arrested and charged with corruption involving $2.22 billion relating to the inflating of the cost of constructing the Arror and Kimwarer water dams in Elgeyo Marakwet County.
And on January 20, 2020, former CS Mwangi Kiunjuri was grilled by the anti-graft agency in an ongoing investigation into an alleged illegal payment of Sh1.8 billion for maize supply in 2019.
Closely linked to the three categories of drugs, economic crimes and corruption cases are spiraling deadly fraud cases. In May 2019, police arrested six suspects over the gold scam in Nairobi, which turned out to be part of a complex fraud scheme where a Saudi royal was conned of Sh400 million gold million.
On February 13, 2020, Echesa was arrested in regard to the Sh39 billion guns scandal case where reportedly duped the US and Poland-based Eco Advanced Technologies that he would help them secure an arms tender at the Ministry of Defence, a deal in which he pocketed Sh11.5 million as consultancy fees.
Mafia capitalism is also capturing local spaces. The high-profile corruption cases of Nairobi and Kiambu counties shows that Kenya is descending into lawlessness with a Mafia-like local governance.
The venal capitalism is riding on electronic communications, which enables criminals to shift large sums of cash rapidly around the world and thus keeping it hidden and unregulated.
Kenya’s local mafia capitalists are joining forces with more seasoned and entrenched counterparts in Western capitalism. Tellingly, the Arror and Kimwarer water dams case involved Italians from the CMC di Ravena—the firm that was contracted—signifying linkages with global mafia capitalism.
The success of the mafia capitalists and their henchmen rests on their ruthless capacity to punish and silence those either attempting to expose their deals or knowing too much. In Mexico, close to 33,000 people went missing and across the country in 2017: silent victims of the drug war. Kenya’s Mafia capitalists are neither taking chances nor prisoners. They are resorting to brutal violence to cover their footprints.
The involvement of the political class at the highest level has given credence to the fear of state capture. Kenya’s mafia capitalists are being defended by those holding the levers of power, and even colluding with elements in state security forces. Their political henchmen are politicizing and ethnicising relentless efforts by security forces to rein in corruption and cronyism.
Failure by the country’s courts to bring to to justice and convict Mafia capitalists and their cronies undermining the rule of law and encouraging others to employ the same means to keep their dirty operations going. Why should one remain a law-abiding citizen, faithfully working eight to five and paying tax bill?
The few pockets of the rule of law holding the country together are at dire risk of virtually collapsed in the Mafia capitalists capture the helm of state power.
But, like patient hunters, Kenya’s robber barons and oligarchs are unbowed, and waiting the country out. Ahead of the 2022 elections, they are hell-bent on deploying their wealth to capture and take control state power, and deal brutally with their challengers.
Peter Kagwanja is the President and Chief Executive of Africa Policy Institute and former Government Adviser.