Get views of Kenyans before making public firms private

One of the absurd repercussions of Kenya having a politics devoid of policy is that for the longest time, the state’s economic agenda hasn’t received the attention it deserves — starting from national budgeting, to borrowing and investment.

PRESSURE

It is for this reason that for the most part, public discourse regarding the country’s economic fate is almost always reactionary, as indicated by the continued protestations over the hasty growth of the national debt since the current government took over the reins of power.

One wonders why it had to take these huge infrastructure loans, especially from China, for the country to sit up, in almost what one may perceive as peer pressure, considering that other Chinese debtors — mostly developing countries in Africa and Asia — are now having similar jittery reactions to their government’s high, and possibly unreasonable appetite for debt.

MYSTERY

The same knee-jerk reactions followed the country’s two Euro bonds, whose necessity was not widely debated beforehand and whose use remains a mirage, traceability of the funds — especially the second bond — having got mired in mystery.

PROPOSITIONS

It is this same reactionary response that has greeted news that the Privatisation Commission is considering selling off to private investors some of the country’s leading parastatals, totalling 26.

For a period of time, especially in the early- to mid-90s, the privatisation debate, as instigated by policy propositions and interventions by the International Monetary Fund and the World Bank, took centre stage in a lot of African countries, whose governments were being urged to transfer the running of state-owned enterprises to private hands, the common refrain being that government had no business doing business.

INCOMPETENT

This push was supposed to be beneficial in a twofold manner: first, by putting money in the State’s hands right away, followed by a predicted improved efficiency of these entities. Some of the parastatals were considered either under performing or mismanaged by mostly incompetent political appointees, hence, the interventions were supposed to inject new impetus into the economy.

Those opposing the privatisation campaign at the time argued that the move was meant to take away from the many and give to the few — in the sense that government-owned entities are considered public property held in trust for the masses, while once privatised, the ownership shifts to a handful of individuals, even if publicly traded in the Stock Exchange.

IDEOLOGICAL

As such, these debates for and against privatisation have almost always taken an ideological direction where those for the relinquishing of state assets proclaim capitalist tendencies in defence of free markets and maximising of profit, while those against deploy socialist ideals in perceived protection of the people’s collective ownership of a country’s means of production.

The political conversation in Kenya has not always happened in neat ideological capitalist-or-socialist terms, and, therefore, one doesn’t expect an economic conversation — which is in effect an integral part of the broader political conversation — to suddenly acquire ideological flare.

PROCEDURALLY

However, what is really important is for the state to stay true to its social contract with the people — as entered into during elections where and when power is donated to the few by the many — such that even if government has made up its mind about these privatisations — which is the more likely scenario — it would be of great importance to do so procedurally, in the political sense.

BUDGETARY

Of course all the technical and legal motions of the process will be followed, but what may not be attracting due government attention is the need for the public to feel that even if some don’t support privatisation, it should not seem as if it is being shoved down the country’s throat. Those who oppose the process must feel they are being heard as much as those who support it, and it would make for necessary national conversation to hear out government on why this move is necessary at this time — aside from the obvious reason that it needs quick money to cover budgetary deficits.

POLICY

One interesting dimension on such a conversation would be to interrogate why the state feels it is necessary to relinquish ownership of state agencies when the governing political party has become an overzealous mentee to China’s Communist Party, whose belief in state run enterprises is self-evident in its construction, banking and other sectors of the economy.

In thinking through its need for immediate money and its political contradictions, coupled with hearing out those who are for or against privatisation, the government, and by extension the ruling party, may just find some sort of policy clarity, be it borrowing elements of the Chinese model and mashing it with its neo-liberal market-driven pursuits.

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