I like reading Dr David Ndii’s column and sometimes I agree with him on a number of issues.
But in his November 8 column titled, ‘Human capital, not mega-projects, will turbo-charge economy’, he was dead wrong. I wish he had done a bit of research to know the impact of the Vision 2030 flagship projects.
In my view, he should have spent his valuable time thanking former President Mwai Kibaki for an excellent job he did while he was at the helm and President Uhuru Kenyatta for showing maturity in continuing with these transformative projects.
When historians come to write about Kenya, they will certainly recognise that it was the Kibaki administration that started what may be called indigenous thinking on how we can chart our economic future.
Against all odds, President Kibaki allowed Cabinet ministers and senior civil servants to take measured risks to implement some of the most transformative projects in Kenya’s history. This is how we were able to implement the ICT infrastructure within a short period, giving rise to additional needs such as technology park that would help incubate start-ups and deepen our human capital.
The Konza City project did not drop from the sky, as Dr Ndii suggests. It was conceptualised in such a way that it would leverage on existing and future infrastructure. The expansion of the Mombasa highway into a dual carriage way and the Standard Gauge Railway (SGR) were meant to directly benefit Konza. The government was to spend funds on the infrastructure within the site and a few buildings to support the incubation of local start-ups.
Most of the vertical infrastructure were to be built by the private sector. We took time to study how we could quickly diffuse technology and leverage on it to transform our economy. We travelled to India and the Silicon Valley, picked up the best practices and signed contracts with global technology companies to co-create and share intellectual property. This is how knowledge is sustainably transferred in modern days.
This was as a result of the fact that our university graduates were unemployable, and the private sector was stuck with archaic production systems with little research.
Today, we see more failures in manufacturing than new companies because the government was not playing its role in facilitating industry and research institutions. Our aim was to create a development corridor similar to the Delhi-Mumbai industrial corridor — a State-Sponsored Industrial Development Project of the Government of India. The purchase of 5,000 acres in the Athi Basin marked the first step in the 1,000-mile project to see our own corridor that would spur the economy.
The knowledge city was to incubate start-ups, pass the necessary skills to recruits and speed up their development into fully fledged companies that could provide skills and absorb many of our graduates, who, instead of utilising their knowledge, are selling second-hand clothes or running errands for politicians. Parallel to these efforts we asked the President to support the Open Data Initiative, which became the lifeblood of the nascent creative industry in Kenya.
Indeed, he launched the initiative and more than 400 data sets were uploaded to the Kenya Open Data Initiative (KODI). We were laying the foundation stone for building a knowledge economy.
I was, therefore, perplexed by Dr Ndii’s article, which though it had the correct title, contained misleading content. How else can one develop human capital without the processes we were putting in place? I least expected Dr Ndii, a leading economist, to confuse human capital (the skills, knowledge, and experience possessed by an individual or population) and education (the process of receiving or giving systematic instruction, especially at a school or university).
In fact, Korea’s success was as a result of its focus on development of skills within its several industrial parks and at technical and vocational education and training, which we have destroyed in favour of a theory-based education system.
In addition, several other successful countries such as Germany put more emphasis on three areas — pre-employment skills development to prepare future workers, in-service training to upgrade the work force’s skills and active labour market training programmes to reintegrate the unemployed and disadvantaged.
The ecosystem of Konza was to provide these three critical missing components in our economic development.
The injection of 5,000 mw into our national electricity grid will be a drop in the ocean if we persistently pursue skills development as I have stated above.
With the advent of 3D printing and a motivated youth with computer literacy, we can change the world.
A liberalised energy sector would be more meaningful than attempting to protect small and inefficient operations that would never bring down prices of goods. Such free thinking will enable our economy to leapfrog others and not just grow in the linear format that Dr Ndii favours.
This linear business model that Nobel laureate Amartya Sen censures in favour of rationalism, is a Western empiricist mentality that my brother Dr Ndii buys as wholesome truth. Western economists themselves admit that their economic modelling does not fully explain our growth patterns. That is how they created Development Economics, a branch of economics that deals with the developing countries.
Dr Ndii should focus on a growing body of research that has been emerging among development economists since the beginning of this century, focusing on interactions between ethnic diversity and economic development, particularly at the level of the nation-state. Wikimedia says that while most research looks at empirical economics at both the macro and the micro level, this field of study has a particularly heavy sociological approach.
The more conservative branch of research focuses on tests for causality in the relationship between different levels of ethnic diversity and economic performance, while a smaller and more radical branch argues for the role of neoliberal economics in enhancing or causing ethnic conflict.
This will be more relevant to our situation just like the contribution of Amartya Sen to welfare economics that highlighted the plight of the poor in his native India.
Back to Vision 2030 Mega Projects. The Standard Gauge Railway benefits far exceed the costs. I do not know if Dr Ndii’s modelling factored in productivity gains to Rwanda, Burundi, Uganda and Kenya. It takes more than two weeks to transport goods from Mombasa to Kampala and three to four days from Mombasa to Nairobi.
It is cheaper to transport a container from Durban to Mombasa than from Mombasa to Nairobi. Also, the Mombasa-Malaba road is constantly damaged by heavy vehicles and needs repair all the time. These vehicles are not just the major causes of accidents, especially when they stall on the highway, but are also heavy polluters.
It is a shame when Dr Ndii suggests that the Thika Superhighway should never have been built. The completion of this short distance highway has attracted more foreign direct investment than the cost of constructing it. Garden City would never have been built at Ruaraka if the road had not been expanded.
In fact, three more major private mega-projects are about to come up. These projects create employment and an opportunity for farmers to supply their produce.
Dr Ndemo is a former PS for Information Communications and Technology