shielding kenya’s economy

Shielding Kenya’s Economy:

Past, Current and Future IssuesMartin Brown [email protected] 0726573459

Presentation Outline

Kenya’s Current Economic Status: Important Statistics

Challenges: Alert! -Threats Vs. Opportunities

Civil Society Actors: Their Role in Economic Development

Martin Brown [email protected] 0726573459

Kenya’s Population Pyramid


Current & Projected State: Critical StatsKenya’s poverty head count

stands at 43.37 - cut-off point of US$1.25 (KES. 105) per person-(Global Monitoring Report, 2013)

Kenya’s economy is projected to grow at 5% in the year 2013.

Kenya’s external debt stood at US$ 9.526 Billion as per estimations as at 31 December 2012.Martin Brown [email protected] 0726573459

Current & Projected State: Critical Stats- Labour Force

Agriculture75%

Industry & Services

25%

Labour Force (2012 est.: 18.89 Million)


Current & Projected State: Critical Stats-Unemployment

With the labor force mentioned in the previous slide, unemployment in Kenya stands at about 42%.

Of the total unemployment, youth unemployment constitutes 70%


Current & Projected State: Critical Stats Kenya: Imports Vs. Exports

$14.39

$5.94

Kenya's Imports Vs Exports (in Billions: 31 Dec 2012 est.)

Imports Exports


GDP: Composition by Sector (2012 est.)

24%

15%61%

GDP: Composition by Sector

Agriculture Industry Services


Kenya’s Economic Freedom Index



Kenya faces various challenges and/or threats that could hinder her economic growth. Opportunities can also be identified amidst such challenges.

Some of these challenges are unique, others are not.Martin Brown [email protected] 0726573459

Opportunities!!!

Devolved Government:The system (if well implemented) is likely to bring unseen benefits to the Kenyan economy, with each county being a big unit of economic growth.


Opportunities!!!

Oil Deposits:The discovery of oil in some parts of the country presents an opportunity (if the deposits are commercially viable and Kenya develops a port and pipeline for oil) for Kenya to balance its growing trade deficit.


Opportunities!!!

Peaceful Elections The just concluded elections were relatively calm (unlike in 2007 polls, after which Kenya’s economy fell by 5.4%age points- from ). The peaceful transition to the new regime is an opportunity for Kenya to grow both her democracy and economy all at the same time.


Opportunities!!!

High Youthful Population Kenya’s ‘youth bulge’ is a potential ‘resource base’ that can be tapped into for economic growth. Otherwise, it can be a disaster for the country’s economy.


Opportunities!!!

Sound Macroeconomic Fundamentals:Renewed investor confidenceStable foreign exchange ratesLow inflation rates (below 5%)



Some of the challenges fall into the following categories: Devolution and County Governance; Youth and Women Empowerment; Food insecurity; Urbanization; Health (read Disease); Climate Change and Disaster Risk

Reduction; Peace and Security;Martin Brown [email protected] 0726573459

Cont’d…Urgent Issue: Devolution & County Governance

Devolution and County Governance: If enough caution is not taken, devolution could go awry and poison the entire economy of Kenya. Good foundation for devolved system of governance must be given the attention it deserves for it to work.

Challenges in terms of the human resource should be addressed even before the other resource deficiencies are thought of.Martin Brown [email protected] 0726573459

Cont’d….Urgent Issue: Devolution & County Governance

Citizen engagement and public participation in governance must be enhanced if devolution is to work in Kenya.

Social accountability systems must be developed and improved further to increase the quality of service delivery and stem inefficiency and corruption especially in the public Martin Brown [email protected] 0726573459

Cont’d…Urgent Issue: Youth & Women Empowerment

Despite the gains made towards this direction, youth and women remain largely dependent on the male elderly adults in many socio-economic dimensions. This is a major impediment to economic development and must be addressed.

The girl-child empowerment must not be relaxed, and youth development must be scaled up for Kenya to realize her Vision 2030.Martin Brown [email protected] 0726573459

Cont’d…Urgent Issue: Food insecurity

Food insecurity is one of the reasons for the persistence poverty in Kenya.

Over 20% of Kenyans suffer from food poverty (entire income is not adequate for purchasing food) [KNBS household budget survey]

Food prices in Kenya are far higher than in Germany, and the U.S. ; international sugar prices are also far lower than those in Kenya.

There must be deliberate efforts towards enhancing food security. E.g. investing more resources in arable lands through irrigation; enhancing research and development;Martin Brown [email protected] 0726573459

Cont’d…Urgent Issue: Urbanization

Kenya’s urban population is estimated at 22% of total population (2010)

The rate of urbanization: 4.2% annual rate of change (2010-15 est.)

Poverty is a major threat to the achievement of MDGs. Urbanization has been a major force behind poverty reduction and, therefore, progress towards other MDGs.

It helps pull people out of poverty and thus advances progress towards the other MDGs.

However, urbanization can also lead to burgeoning growth of slums, pollution, and crime if not managed well, and thus compromise economic growth and the achievement of all the other MDGs.


Urgent Issue: Health & Disaeses

Diseases such as HIV/AIDS, TB, Diabetes and Cancer are becoming more menacing to the population.

2009 estimates rank Kenya 4th in the world (after S.A, Nigeria & India) in the number of PLWHAs

These eat into the productivity of the country’s labour force

They also add extra economic burden to already constrained populationMartin Brown [email protected] 0726573459

Cont’d…Urgent Issue: Climate change and Disaster Risk Reduction

Climate change is a major threat to the growth of Kenya’s economy.

It has resulted to increased frequency and intensity of hydrometeorological disasters in Kenya in the last two and a half decades.

Weather-related shocks (mainly floods and droughts) have acted negatively on the economy.

Besides the deaths of productive members of the labour force, much destruction has been witnessed as a result.Martin Brown [email protected] 0726573459

Cont’d…Urgent Issue: Climate change and Disaster Risk Reduction

A conservative estimation KES. 22 Billion have been lost in terms of damaged infrastructure during in just floods in the last two years only. With the ongoing rains in many parts of the country, this figure is already too OBSOLETE!

Similar (or even worse) scenarios are likely in the future, and urgent measures are necessary to climate-proof our infrastructure as well as reduce the impacts of drought in Kenya.Martin Brown [email protected] 0726573459

Critical Counties in RV Towards Bearing in mind the critical drivers of economy

and factors towards achieving the MDGs, certain Counties in the country will play a critical role in the growth (or otherwise) of Kenya’s economy.

These include (in Rift Valley): Nakuru Narok Kericho Uasin Gishu Trans Nzoia TurkanaMartin Brown [email protected] 0726573459

CSO: Critical Actors

The Civil Society will play a critical factor in the growth of Kenya’s economy and democratic space.

With the devolved system, the PBOs will provide the very much needed voice in various sectors and on various issues.

Strengthening of the CSOs to effectively play this role is an essential step towards safeguarding and developing democracy and economic growth in Kenya.Martin Brown [email protected] 0726573459

CSO: Critical Actors

Whereas the CSOs operate almost all sectors of the economy, attention must be enhanced in some critical spheres, including: Human Rights, Leadership, Democracy

and Governance; Participatory Budgeting & Integrated

Financial Management (in Public-Private partnerships)

Public Participation in the devolved system;

Socio-economic development (empowerment)

Environment and Natural Resource Management


One TRICK…?

For Kenya to achieve a sustained high growth for the remainder of this decade, there are several determinants.

The single-most important of these determinants is:

Kenya’s capacity to mitigate against socioeconomic and political shocks.Martin Brown [email protected] 0726573459

Fin…

Muchas Gracias!


shielding kenya’s economy

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