River basin blocs can boost ‘Big Four’

Kenya’s economic model focused on trickle-down neoliberal orientation until the 2010 Constitution.

The new law provided a stronger basis for economic development supported by devolution. The aim is to spur transformation from the country’s nerve centres — the counties.

The ‘Big Four’ has also provided a clear pathway to spur the country’s productive potential at the household level through agriculture and trade development. The Companies Act 2015 enables Kenyans to easily venture into the commercial sector.

MARKET ACCESS

When President Uhuru Kenyatta pronounced the ‘Big Four’, it was a momentous target that requires the contribution of all Kenyans. The call to achieve 15 percent share of manufacturing to our country’s wealth means increasing the sector’s output by about Sh1.6 trillion by 2022. About 60 percent of manufacturing output should be exported, beginning with Africa, which constitutes 17 percent of the world market.

President Kenyatta has aggressively led Kenya’s market access wins. That includes including positioning Kenya to be the first country to sign and ratify the Africa Continental Free Trade Area (ACFTA), strengthening its relationship with the US under the duty-free market access under Agoa, positioning Kenya towards improved terms of trade with the Chinese, strengthening trade with the European Union and sustaining trade and investment with the UK in the wake of Brexit.

KEY OBJECTIVE

Other initiatives include positioning Kenya to trade with France, and strengthening commercial and economic relations with Israel, Japan, India, and the United Arab Emirates.

France hosted leading entrepreneurs and political leaders in Paris in October. The forum, dubbed Ambition Africa, was aimed at re-thinking and re-engaging the continent to doing business and catalysing entrepreneurship and triggering export-led economic orientation, a sustainable path for industrialisation. France is working to strengthen trade support institutions in 20 sub-Saharan countries.

The Intra-Africa Trade Fair in Cairo from December 10 is aimed at mobilising the 22 countries to ratify ACFTA and encourage African entrepreneurs to do business together, to achieve higher intra-Africa trade, in part, a key objective of the Agenda 2063 for Africa economic and industrial transformation. In addition, governments will engage on elimination of tariffs and non-tariff barriers to catalyse intra-Africa trade.

COMPETITIVENESS

But these opportunities require adequate preparation, and this shifts the focus to the role of both public and private sectors as well as well as trade support institutions. The counties would be the production centres for the country in meeting the huge market opportunities.

One way that our productive capacity would catalyse socio-economic transformation is the ongoing formation of county economic blocs, which seek to spur economies of scale and reduce internal barriers to trade.

Heavily regulated economies do not benefit from international trade due to weak competitiveness. Kenya has significantly improved its ease of doing business index to position 61 out of 190 world economies. Further improvement at the counties would place Kenya under 50 in the next year.

DEEPEN HARMONY

One way that counties can position themselves as the accelerator for economic and industrial transformation is to set up economic blocs along the river basins to take advantage of national frameworks that transverse Kenyan communities. The major cities emerged along river basins, which were the epicentre of agrarian and industrial revolution.

Counties forming economic blocs along Kenya’s river basins to meet their obligations to contribute to the realisation of the ‘Big Four’ will deepen harmony and unity a prerequisite for the nation’s prosperity.

ECONOMIC MODEL

Kenya has six river basins — in the Kerio Valley, Lake Basin, Tana and Athi River, Coast, Ewaso Ng’iro North and South. The formation of the Coast and Lake Basin economic blocs should be emulated by the rest of the counties. Such a framework would bring to reality the country’s quest to enhance local as well as national economic development. It would also spur institutional strengthening of our regional development authorities.

This way, the counties would emerge as the growth poles for our manufacturing and exports sector. The target of Kenya in the ‘Big Four’ to achieve 15 percent share of the country’s wealth will become a reality with such an economic model in place. The country would achieve higher middle-income status faster.

Mr Biwott is the chief executive officer, Export Promotion Council. [email protected].