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DIVIDENDS, DEFICITS, AND DEVELOPMENT: Can Kenyan Millennials Ride the Demographic Wave?

Falling fertility and mortality rates have put Kenya in line to reap the same demographic dividend that powered the rise of the Asian Tigers – but only if it gets its social and economic policies right. By PAUL GOLDSMITH

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DIVIDENDS, DEFICITS, AND DEVELOPMENT: Can Kenyan Millennials Ride The Demographic Wave?

The population surge now taking place across sub-Saharan Africa is this continent’s equivalent of the Western post-war Baby Boom. The congruence with demographic transitions elsewhere suggests that in theory, Africa’s “Baby Boomer” millennials are well positioned to affect a radical transformation. The case for a generational social movement intersects Kenya’s potential for a demographic dividend similar to the one underpinning the rapid rise of the Asian Tigers.

Two thousand years ago, Africans comprised an estimated 12 to 15 per cent of the world’s population. Africa’s share had dropped to 9 per cent by 1500 AD. By the end of the 19th century, the export of African slaves to the Americas and environmental calamities contributed to its decline to 6 per cent. Initial conditions, including the continent’s low population densities, physical and spatial barriers to communication, and historical isolation from other world regions, made it vulnerable to European exploitation.

Africa’s population began catching up during the decades of colonial rule, and spiked after independence. The continent’s share of the world’s population reached 17 per cent in 2017, and Africa is projected to host over a quarter of the world’s people by 2050. Naturally, the exceptionally high growth rates of the past several decades pose some formidable developmental challenges for Kenya and for the many other African nations with similar demographics.

Fewer births each year results in a country’s young dependent population decreasing relative to the working-age population. With fewer people to support, a country has a window of opportunity for rapid economic growth, but only if it gets its social and economic policies right. The decline in fertility, albeit slower than was the case in Asia, should exert a similar effect on African countries.

Kenya’s population has been surging since independence, growing from 8 million in 1960 to 13 million in 1975, and doubling to 26 million in 1995. These numbers confirm the fact that all the generations of Kenyans alive today were “Baby Boomers” when they came of age. The result is a population pyramid that over time has more in common with Mt. Kenya than with Mt. Kilimanjaro.

Since the colonial era, Kenya’s lopsided population distribution, where over 80 per cent of the population is concentrated in the 23 per cent of high potential land, has combined with the threat of environmental degradation to provoke Malthusian predictions of impending calamity. During the 1990s, urbanisation and the numbers of new university graduates entering the economy provoked a new set of concerns.

Kenya’s population has been surging since independence, growing from 8 million in 1960 to 13 million in 1975, and doubling to 26 million in 1995. These numbers confirm the fact that all the generations of Kenyans alive today were “Baby Boomers” when they came of age. The result is a population pyramid that over time has more in common with Mt. Kenya than with Mt. Kilimanjaro.

In 1998, I reviewed an internal US State Department analysis of the problem that outlined three future scenarios for Kenya: economic take-off; collapse; and muddling through. Where the document highlighted the prospects for political instability in the future if the then Moi regime of public mismanagement and political corruption were to persist, I opined that Kenyans were a resilient people who would somehow manage as long as the rains were okay.

This proved to be true. The rise in annual GDP growth during the following years may have partially offset the spreading rot, but the large numbers of educated youth entering the work force exposed the unsatisfactory state of affairs, as the accounts of urban millennials published in The Elephant over the last two months have shown.

Demographic dividends and deficits

Population growth in the form of natural increase and mass migration is one of the primary forces of historical change. However, demographic structure is acknowledged to be the more important indicator for developmental policy. The latest population numbers for Kenya provide the quantitative parameters of the country’s shifting generational balance.

Kenya Population Structure, 2017

Kenya Population Structure, 2017

Source:  CIA World Factbook

The backlash against the elders highlighted in many of the Elephant’s Millennial Edition is tempered by their relative scarcity. The elderly – people over the age of 65 – now comprise only three per cent of Kenya’s 48 million population. The 25-54 age group’s current share of the population is now one-third larger than it was in 1975.

One notices the difference conveyed by these statistics as soon as you step off the plane almost anywhere in the northern hemisphere. America’s retiring Baby Boomers, for example, are 16 per cent of the U.S. population. In South Korea, so often cited to underscore the two countries’ diverging economic pathways over the past several decades, the figure is 13.5 per cent. The world’s estimated average is edging towards 10 per cent and growing; the trend will translate into a global reduction in household savings and returns on financial assets. This will reduce the growth of household wealth from the historical mean of 4.5 per cent to 1.3 per cent over the next two decades, according to research on global demographic trends.

These numbers qualify the demographic dividend David Ndii referred to in his contribution to the discourse. Formally defined, the demographic dividend is the accelerated economic growth assisted by a decline in a country’s mortality and fertility and the shift in the age structure of the population. This dividend can be activated when pro-human capital policies combined with a large working-age population create virtuous cycles of wealth creation.

The dividend accounted for an estimated two-fifths of the Asian economic miracle. Now it may be Africa’s turn. Population numbers are moving in this direction, but there are basic prerequisites that must be in place for it to happen. Flexible labour markets, quality education systems and health services, and outward-looking economic policies are conventional elements of the formula.

Kenya’s formal policy framework meets most of the criteria. Despite the slower than expected fertility rate decline, Kenya’s dependency ratio is hovering between 76 per cent and 80 per cent. This means one working individual currently supports up to four dependents, but the ratio will decline, bringing Kenya in the rank of countries expected to reap the dividend. But there is no guarantee that this will happen, as the dividend is time-bound. The equation has real and potential implications for millennials, especially considering that important economic indicators, such as investments and savings, are trending in the opposite direction.

The demographic surge raises the stakes for getting policy right. In the case of Latin America, weak governments and closed economies saw large areas forfeit their dividend during the years between 1965 and 1985. Comparative analysis indicates the interactive effect of policy and demography accounts for 50 per cent of the growth gap between Latin America and East Asia. The corresponding observations about demographic deficits, or the failure to maintain living standards due to population decline or other systemic inefficiencies, underscore the imperative of getting the long-term policy equation right.

The demographic surge raises the stakes for getting policy right. In the case of Latin America, weak governments and closed economies saw large areas forfeit their dividend during the years between 1965 and 1985.

Japan and Europe are now going through the decline phase of their demographic transition. Socio-economic change diminishing the role of extended families and other social mechanisms exacerbates the problem, requiring that the state enact effective social policies to bridge the gap. Although post-war Japan maximised its dividend, it is still having problems coping with a population that is shrinking and aging at the same time. Despite its sustained economic growth, almost half of South Korea’s citizens aged over 65 now live in relative poverty, defined in this case as earning 50 per cent or less of median household income. High levels of isolation and depression have led to a dramatic rise in suicide among the elderly, from 34 per 100,000 people in 2000 to 72 per 100,000 people in 2010.

The United States, in contrast, has traditionally relied on immigration to maintain its working-age population. This has countered the aging variable while sustaining a major source of socio-economic revitalisation in the form of new blood and cultural diversity. The noise from President Donald Trump and his base conflicts with the fact that the 75 per cent of Americans support immigration, and they report that the diversity of immigrants makes the country a better place. The country has systematically capitalised on this multicultural dividend to rejuvenate the population and refresh its economy throughout its history. Present controversies over uncontrolled immigration and refugee influxes camouflage the fact that Europe has lately been following a similar – though undeclared – policy pathway.

Demographic transitions typically involve a large jump in population followed by a steady decline as investment in fewer children replaces the risk-spreading and agricultural labour function of large families. In Kenya, where the fertility rate remained in the mid-3 per cent range until the last decade, perhaps the prolonged transition to “adulating” lamented in some of the millennials’ accounts may hasten the fertility rate to drop to the replacement level of 2.1 children per woman from the 2.7 of the past decade.

The employment numbers indicate that the process of reaping the dividend here is less linear and subject to the distinctive features of Kenya’s geography and domestic politically economy. The median age in Kenya is now 19, and Kenya’s 39 per cent overall unemployment rate translates into 22 per cent for youth. The numbers for neighbouring countries are much lower: 4.1 per cent for Uganda; 5.2 per cent for Tanzania; and 3.1 per cent for Rwanda. Even Nigeria, Africa’s most populous country, has a significantly-below-Kenya youth unemployment rate of 13 per cent.

Even though we should not accept all these economic numbers at face value (the less visible parallel economy that doesn’t show up in official statistics is an important source of informal sector livelihoods in Kenya), we may be facing the politically explosive demographic overload scenario that was detailed in the State Department study twenty years ago.

The median age in Kenya is now 19, and Kenya’s 39 per cent overall unemployment rate translates into 22 per cent for youth. The numbers for neighbouring countries are much lower: 4.1 per cent for Uganda; 5.2 per cent for Tanzania; and 3.1 per cent for Rwanda. Even Nigeria, Africa’s most populous country, has a significantly-below-Kenya youth unemployment rate of 13 per cent.

The demographic dividend has a finite window; it does not occur automatically. Both the policies and their timing are critical, which is why Kenya’s millennials are facing a two-pronged dilemma: unemployment is high yet some 47 per cent of the Kenyans sampled in a 2014 Pew Research Survey reported that aging is a major problem. The figures for populous Nigeria, crowded Egypt, and middle-income South Africa came in at 28 per cent, 23 per cent, and 39 per cent in comparison, respectively.

These factors raise the stakes for Kenya getting things right now. But there is more at the crux of the debate than economic policy and warm bodies. Technological innovation works with population increase to drive human adaptation, and developments are moving rapidly on this front.

The fast-moving advance of the fourth technological revolution suggests that Kenya and its neighbours in Rwanda and Ethiopia have the potential to jump the queue if they position themselves properly for the longer run. Negative implications of artificial intelligence for the future of work should not distract us from the benefits on the horizon. The technology sector and building the industrial Internet may serve the same role that manufacturing did in Asia, although the potential for the same demo-techno double dividend cannot be taken for granted.

Assessments of African economic trends now argue that Africa is not likely to transit through the phase of manufacturing and carbon-driven energy generation that powered the post-World War II rise of East Asia and other world regions. Fourth generation technologies, in contrast, can generate an equivalent rise in prosperity and economic growth. This will come about through their contribution to everyday economic domains like health care, resource management and precision agriculture. Digital platforms are already creating a new small-scale ecosystem for commodity marketing, financial inclusion, and women’s empowerment according to one Kenyan expert.

The potential for tech-driven growth will require more than the tech hubs being established in Africa’s tech-friendly countries. It requires the kind of unorthodox and often irreverent problem-solving mindset that the country’s education system is adept at quashing.

The dynamic relationships linking scientific research, applied technology, and venture capital are critical to contemporary processes of innovation. This requires an enabling cultural environment, as demonstrated by the rise of American tech hotspots in the San Francisco Bay area, North Carolina’s research triangle, and the northeastern corridor. These hotspots were not planned; rather, the presence of top research universities and a culture of critical thinking and entrepreneurial risk-taking enabled their rise to prominence over the past three decades.

Kenya’s economy was building towards a transformational tipping point before events saw the country drift into a nebulous purgatory of ethnic polarities and failed constitutionalism. Now deficit financing of infrastructural projects and massive corruption are continuing to remove from circulation critical resources that could be energising the younger generations’ pent-up human capital.

The future availability of such investment capital cannot be taken for granted. It may decline apace with the industrial world’s demographic deficit over coming decades. Then again, demographic trends and the historian John Illife’s treatise on The Emergence of African Capitalism suggest that the continent just may step into the gap. (This was in 1981.) The importance of this synergetic union of capital and labour happening now extend beyond the African continent due to the significance of Africa’s expanding share of the world’s economically active population for the world economy.

Kenya’s economy was building towards a transformational tipping point before events saw the country drift into a nebulous purgatory of ethnic polarities and failed constitutionalism. Now deficit financing of infrastructural projects and massive corruption are continuing to remove from circulation critical resources that could be energising the younger generations’ pent-up human capital.

Beyond demography and economic policy

The first thing that strikes me when I get off the plane back in Kenya is the high level of activity almost everywhere one looks. The country is bursting with energy, but some of it is misdirected and much of it is generating low per capita returns.

The former World Bank head for Kenya, Apurva Sanghi, attributes the mismatch between job requirements and the shortfall of skilled labour due to the poor quality of education. This mismatch clashes with the millennials’ claims about their high level of education. The dramatic growth in universities in Kenya saw quantity replacing quality and the acquisition of paper qualifications displacing the search for knowledge. The commercialisation of higher education has in effect been another drain on the economy that has deprived a large segment of the millennial generation of the skills commensurate with their degrees and diplomas.

The more one studies the data, the more muddled the already uncertain big picture becomes. Even so, the long-term fundamentals, including the country’s 5 per cent per annum growth rates, are at best just okay.

As the latest World Bank overview for Kenya states, Kenya has the potential to be one of Africa’s success stories. All the country has to do is address “the challenges of poverty, inequality, governance, the skills gap between market requirements and the education curriculum, climate change, low investment and low firm productivity in order to achieve rapid, sustained growth rates that will transform lives of ordinary citizens.”

This is a very tall order and until this happens the country will continue to face the risk of stagnation and a creeping demographic deficit. The clock is ticking. In any event, the country needs more than the population-based dividend to drive its transformation. Assuming that demographic growth and the right policies do account for up to 40 cent of the Asian economic miracle, where did the other 60 per cent come from?

Japan and the Asian Tiger nations achieved their reputation through rapid growth compacted within the space of several decades. The demographic dividend is the central component in the developmental mantra explaining East Asia’s remarkable transition. The dividend was activated by policies that combined agricultural commercialisation, liberalisation and the relaxing of state controls, fostering a combination of domestic industry and export-led growth with favourable international economic conditions.

South Korea, the most popular exemplar for other developing countries, implemented deliberate population policies and pragmatic economic guidelines that helped create an age structure facilitating its rapid transition from an agrarian to an industrial society during the short interval between 1960 and 1990. The mutually reinforcing economic and population policies resulted in a basic shift at the household level, with changes in women’s roles and the rise of a middle class in place of the formerly dominant land-owning aristocracy.

The Asian exemplars counteracted the influence of Malthusian assumptions on post-independence developmental thinking, and now the Chinese model figures prominently in the calculations of many African political decision-makers. The Lamu Port, South Sudan, Ethiopia Transport Corridor (LAPSSET) project is emblematic of the focus on large infrastructure projects, natural resource exports, and extractive industries. The proposed Konza Technology City is another worthy but flawed project representative of the central command approach. The coders, investors, nerds, and hackers are not thrilled about moving to a corporate complex in the hinterland in the tradition of sparsely inhabited cityscapes like Brasilia, Morogoro, and China’s Xiongan megacity.

Asia’s big blueprint approaches were consistent with the central planning tradition and Confucian ideologies of social harmony that justified past South Korean and present Chinese and North Korean dictatorships. But there was nothing particularly harmonious about the Asian developmental processes that grew out of the region’s intense internal and territorial struggles, all of which reflected the zero-sum stakes of the era’s ideological conflicts. The triumph of capitalism in that region was anointed with blood, napalm, and genocidal pogroms. The success of the Asian Tigers was the culmination of a long fight that began with imperialism and led to new policies midwifed by fierce competition within old societies sharing similar environmental settings and socio-economic constraints.

Africa’s distinctive features, however, contrast with the conditions underpinning the Asian developmental orthodoxy. In the case of Kenya, competition between communities and opposition to the state prevail whereas in Asia competition and conflict were over ideology and economic models. Growing local opposition to centrally-planned projects in places like Turkana, Isiolo, and Lamu is indicative of the kind of political and social obstacles now complicating the next phase of the proverbial way forward.

Milk, as the pastoralists’ blockade of the road to Lodwar indicates, is still thicker than oil in the Horn of Africa.

It is interesting that the Marxist planners of the superpower era in Eastern Europe saw artificial intelligence as the natural ally of socialist development. AI may still prove to be an antidote to the inequities promoted by neoliberal capitalism. Where Western advisors stressed population control, their socialist counterparts in Africa saw population growth as integral to the continent reclaiming its position on the world stage. The prospects of this happening over the next several decades reminds us that Marx was one of the few analysts to critique the natural laws of Malthus when he postulated that each society at each point in history has its own laws that determine the consequences of population growth.

In traditional African systems, these laws often reflected the dynamics of generational succession. The cultural emphasis on the wisdom of the elders supported their embedded cross-generational influence on decision-making. I witnessed negative examples of this tradition in my children’s schools, where on more than one occasion, I lost arguments with fellow parents over issues like setting up computer labs and Internet connections. Kenya’s fossilised education system is one of the culprits responsible for the under-35ers’ angst, and this is corroborated by another recent essay on the multidimensional crisis plaguing higher education, published in The Elephant.

Has the generational model of African development hit a wall? The unproductive transfer of generational assets that formerly sustained capital formation is undermining productivity in the highland areas that fueled Kenya’s post-independence prosperity. When parents die they bequeath their wealth to their children, and this powered economic growth and diversification in the past. This vector is now turning family farms into dead capital as the owners age and their children working outside the sector block the sale of family land. The widespread leasing of small acreages and the break-up of large farms into parcels for rent is one symptom of a malaise that impacts beyond the agricultural sector.

 

The economic planners that once fostered Kenya’s economic growth have morphed into bureaucrats trapped in the development administration contradiction Bernard Schaffer identified in 1969. Schaffer argued that the first imperative of state administrators is to conserve and protect their bureaucracies while “development” is essentially an entrepreneurial activity. Kenya’s cartels and tenderpreneurs offer proof of the term’s oxymoronic logic.

 

Everywhere the millennials look they see dead ends, or so it seems from the urban point of view. Ndii’s “Hustler Nation essay argues that multiple productivity enhancing interventions in rural areas will generate far more to youth employment and productivity than the mega project revenue vampires they have conjured up. The resources allocated to building a tech city, for example, would be better invested in interdisciplinary IT programmes hosted by universities across the country, and other nodes dedicated to addressing economic activities ripe for innovation.

Everywhere the millennials look they see dead ends, or so it seems from the urban point of view. Ndii’s “Hustler Nation” essay argues that multiple productivity enhancing interventions in rural areas will generate far more to youth employment and productivity than the mega project revenue vampires they have conjured up.

These are the kind of issues that the millennial generation intellectuals and activists would do well to explore and debate. Their future, if not present welfare, will likely depend on developing creative developmental formulae consistent with the region’s historical trajectory and distinctive socio-cultural variation. A shift in this direction is beginning to gather speed on the county level, where the stakeholders are much better situated to generate the adaptive policies needed to maximise the demographic dividend.

In any event, we now know that progress is more a function of trial and error than the strategic planning processes and interventions managed by actors who remain insulated from their failures and unintended consequences. Devolution generates local initiatives, like the Makueni County public health revolution, which can be replicated and tweaked to fit the conditions in other settings.

Considering the obsession with branding of almost every Kenyan enterprise, with its vision and mission statements, more expansive thinking on these issues is one area where The Elephant’s Millennial Edition articles came up short. But they are not, as David Ndii contended, “on their own”. In addition to their rural age-mates, there is a growing transnational movement out there that is beginning to coalesce into a mass generational movement.

I hope it happens. Africa does need to regain its rightful place in the world, and someone needs to rescue the species from the Trumpian values of late capitalism.

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Mr. Goldsmith is an American researcher and writer who has lived in Kenya for over 40 years.

Features

THE 21st CENTURY ECONOMY: In God We Trust, Everyone Else Bring Data

Blockchain technology has the necessary framework to address the challenge of accounting for human capital and allowing for democracy and the creation of knowledge in order to grow the economy. Argues BETTY WAITHERERO

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THE 21st CENTURY ECONOMY: In God We Trust, Everyone Else Bring Data

In a well-written article, economist David Ndii finally went on record with a counter-proposal to the Jubilee economic platform: “If knowledge and human capital are the engines of economic growth, what is the role of the foreign investment and infrastructure edifices that our governments are obsessed with?” he asked.

Dr. Ndii proposes a more realistic approach for a developing nation such as Kenya: Grow the economy by investing in both knowledge and human capital, rather than by mimicking growth seen in already developed nations that focus investments on infrastructure.

In developing countries like Kenya, the returns on government investments in infrastructure and inventory to create capital will always lag behind the initial amount invested i.e. there will be diminishing returns to scale. Ultimately, it will take Kenya a long time to recoup its investment in the standard gauge railway (SGR), for instance. As we can see currently with this particular infrastructural investment, the level of profits or benefits gained through the building of the SGR is significantly lower than the amount of money invested and will remain so for a long time. This is unhealthy growth, but expedient in the short term, in that it is convenient for the government to make such investments even when it is not necessarily wise or morally right to do so.

However, forming capital in an economy by investing in innovation and acquiring human capital – getting people to be productive and to work – will always lead or be at par in proportion to the initial amount of money or resources invested, creating constant returns to scale. Basically, an increase in investments in knowledge and human capital will cause an increase in economic productivity. This is healthy growth because knowledge is wealth, economic growth is learning, and the individual in conditions of economic and political liberty is the resource. These are uncomfortable notions that governments and people must accept before investing in knowledge; democracy must become an enabling means to ones’ productivity and livelihood, going beyond mere politics and electoral cycles.

Dr. Ndii’s explanatory narrative of how both Robert Lucas’s and Paul Romer’s models work together to generate endogenous growth allows us to understand that economic growth, for developing nations especially, is rooted in being able to account for human capital and innovation. In a nutshell, Paul Romer’s endogenous growth theory holds that it is the creation and investment in knowledge, human capital and innovation that is the more substantial contributor to economic growth.

Investing in people

For emerging economies like Kenya, endogenous growth theory and its possible application allows us to correct nearly 150 years of chasing the consequences of other nations’ economic decisions and interests. Put simply, Kenya, just like many other previously colonised African nations, has an economy that is designed to primarily serve the interests of its former coloniser. And despite the intentions of successive governments, a lack of human capital accounting (identifying, reporting and measuring the value of human resources in a country) has ensured that this economic model works to the detriment of the majority of the population.

Of all the devices created by human beings, the government is the most formidable and consequential. The government is responsible for all the best and all the worst happenings in humanity’s history, as well as for everything in between. This device has evolved over generations, taking on different forms and purposes consistent with the prevailing paradigms and needs of its wielders.

The aspirations of the Jubilee government, as expressed in its Big 4 agenda, are to spur and ignite Kenya’s economic growth by ensuring food security and universal healthcare, building affordable housing and increasing manufacturing. However, motivating an entire nation of more than 40 million people to achieve these goals demands a paradigm shift. Investing in human potential, knowledge, skills and creativity ought to be the drivers of economic growth, rather than the seemingly strict investment in state and capital assets, as is the current government’s approach.

Investing in people is not restricted to education; it includes funding for research and innovation, and also investing in information platforms, healthcare and provision of sustenance. In other words, if indeed the Jubilee government wishes to create one million jobs every year, it ought to invest in the people who will do these jobs.

The aspirations of the Jubilee government, as expressed in its Big 4 agenda, are to spur and ignite Kenya’s economic growth by ensuring food security and universal healthcare, building affordable housing and increasing manufacturing. However, motivating an entire nation of more than 40 million people to achieve these goals demands a paradigm shift.

Automation and the productivity gap

The reality is that technology and automation are putting people out of jobs already. In August this year, the Daily Nation reported that 2,792 banking staff had been laid off due to increasing automation and declining profitability – the effect of unintended consequences of the move to mobile financial applications to reach the unbanked, eliminating the need for intermediaries in the banking hall, coupled with the effects of government policies seeking to cap interest rates. This is an ironic outcome given the government’s goal of financial inclusion and greater employment.

Automation in other economies is creating a productivity gap. Increasingly, jobs that were previously done by people are being taken over by more efficient and more accurate machines and robots. This cuts across industries ranging from manufacturing to food production, leaving behind a population of people who do not have the requisite skills for jobs outside their industries. These people fall through the gaps, and remain unemployable for months or even years.

In an article published in Fortune,This is the Future of Artificial Intelligence”,

the wealthy entrepreneur and Xerion CEO, Daniel Arbess, highlighted the profound manner in which Artificial Intelligence (AI) algorithms are eating up human jobs. “Our political leaders don’t seem up to the policy challenges of job displacement — at least not yet, but the application of Big Data software algorithms is elevating decision-making precision to a whole new level, creating efficiencies, saving costs or delivering new solutions to important problems.” he wrote. “The Bank of England estimates that 48% of human workers will eventually be replaced by robotics and software automation.”

Kenya’s unemployment rate is estimated to be 11.4 per cent. This unemployment rate translates to a further 30 per cent of the population living in extreme poverty. There are many harmful social and psychological effects of short- and long-term unemployment, including alcoholism, homelessness, and rising crime, especially crimes that target more vulnerable people such as women and children.

The situation is compounded by nearly three decades of missed growth opportunities brought about by the fact that there was a lack of human capital accounting. Even at its most prosperous, Kenya’s economic policies simply assumed that jobs would be created via investment in infrastructure rather than in people. Consequently, we have a debt culture that affects the entire nation.

Furthermore, having nearly 83 per cent of the working population in the informal sector means that capital is not accessible through tax revenues – a situation that the government opted to address through new taxation aimed at mobile transactions and data. Emerging economies like Kenya need small business to thrive, but work is not forthcoming. Business opportunities are declining, incomes are diminishing and purchasing power is diminishing.

The situation is compounded by nearly three decades of missed growth opportunities brought about by the fact that there was a lack of human capital accounting. Even at its most prosperous, Kenya’s economic policies simply assumed that jobs would be created via investment in infrastructure rather than in people. Consequently, we have a debt culture that affects the entire nation.

And because the government is hoarding tenders (in July, Uhuru Kenyatta ordered a freeze on new government projects), business is hoarding opportunities and banks are hoarding finance. As productivity is constrained, banks and non-bank financial institutions (NBFIs) are distributing through debt the purchasing power that businesses are not distributing through salaries.

China is doing the same on an international scale by distributing purchasing power through debt as a substitute for national economic growth. It is building infrastructure, such as highways and railways, using loans that are then spent on Chinese companies that serve China’s interests, even though the infrastructure will, hopefully, eventually benefit the debtor nation.

Human capital accounting

A lack of accounting for human capital exacerbates the situation. An economic model that seeks great investment in infrastructure in order to boost the economy but does not account for people engaging in economic activity will result in a mismatch, most graphically seen in an absence of skilled and qualified professionals adept at doing the new jobs that are created. So, without the necessary skills, the locals fall through the employment gaps, and unfortunately, foreigners, with the requisite skills, are hired.

Governments advance the welfare of citizens by establishing and executing public policy for net positive outcomes. This is conventionally done through the creation of rules and regulations, and enforcing their compliance. If viewed in technology terms, the government can be described as a protocol stack (a set of rules) that responds to any input in a prescribed manner consistent with underlying statutes. Indeed, failures in government can be spectacularly linked to the ignoring, circumvention or subversion of the procedures set forth to guide healthy operability among various constituencies and concerns among the citizenry.

Smart-law is the idea that a legal statute can be implemented as a digital computational protocol to which users can connect, execute and return results exactly according to the purpose and design of the underlying legal architecture. There are benefits to a smart-law paradigm, including the fact that it can be censorship-resistant, in that transactions cannot be altered and anyone, without restriction, can enter into those transactions; it is trustless, meaning that trust (knowing and trusting the other party to fulfil their obligations) is not necessary or required, and it does not discriminate in the manner or order of its operations.

The Kenyan government has taken action to advance citizen-centred public service delivery through a variety of channels, including deploying digital technology and establishing citizen service centres across the country. Smart-laws that can provide compliant, straightforward and predictable interactions between citizens and the bureaucracy would have a big and important role to play in this endeavour.

The world in the 21st century is one of advancement through technology. Everything has made a leap forward in one way or another through the impact of technology. It is also true that among all entities, the government remains the most obstinately slow in embracing technology and innovation.

The Kenyan government has taken action to advance citizen-centred public service delivery through a variety of channels, including deploying digital technology and establishing citizen service centres across the country. Smart-laws that can provide compliant, straightforward and predictable interactions between citizens and the bureaucracy would have a big and important role to play in this endeavour.

The time is right for the government to undergo a technology-driven transformation that it so yearns and that will bring it up to par with the industries and sectors it intends to effect. By doing so, it can unleash the potential of the 21st-century citizen.

Blockchain technology

Kenya’s recognition of blockchain technology via its Blockchain Task Force headed by Dr. Bitange Ndemo allows for a little optimism. I will provide a simple explanation for this technology. Blockchain is very often conflated with bitcoin and cryptocurrency trading. However, blockchain is an incorruptible digital ledger where transactions are recorded and cannot be altered. In securing these transactions, computer processors complete complex mathematical equations which when solved are rewarded with a token. The token can bitcoin, or ethereum, all depending on which blockchain platform is being utilised.

The trading and investing of these coins by laypeople in Kenya (sometimes leading to loss of funds) is what leads both Dr. Patrick Njoroge and Dr. David Ndii to call cryptocurrency a scam. I am inclined to agree with them on the matter of how the trading is conducted in Kenya – some traders entice investors with a multi-level marketing or Ponzi-style scheme. But I disagree with a blanket declaration writing off this technology and its potential utilisation in governance and its products, the cryptocurrencies. I recently had a robust discussion with Dr. Ndii on twitter on the same matter.

It is my firm belief that blockchain technology has the necessary framework to address the challenge of accounting for human capital and allowing for democracy and the creation of knowledge in order to grow the economy.

Together with two of my colleagues, Andrew Amadi, who is a sustainable energy engineer, and Chris Daniels, who is an economist and programmer, we created the Freework Society in 2017 with the aim of achieving this particular goal through a programmable economic model built on ethereum blockchain. (Ethereum is an open-source, public, blockchain-based and distributed computing platform and operating system featuring smart contract functionality.)

It is my firm belief that blockchain technology has the necessary framework to address the challenge of accounting for human capital and allowing for democracy and the creation of knowledge in order to grow the economy.

In developing a public computing infrastructure that can implement smart-laws, and which can also account for anyone’s work and effort, and can allow for investment in innovation, we were compelled to improve the very platform we would utilise by creating a standard. This standard is called an Ethereum Improvement Proposal (EIP), which describes core protocol specifications, client application programming interface (API) and contract standards. In a nutshell, an EIP describes how the platform will function if the proposal is implemented.

In developing countries like Kenya, the returns on government investments in infrastructure and inventory to create capital will always lag behind the initial amount invested i.e. there will be diminishing returns to scale.

Our proposal is to utilise the opportunities presented on ethereum blockchain technology by creating a human capital accounting framework that provides a merit-based system of indexing human resources, knowledge and talent, and subsequently reducing market search costs and challenges to price discovery and increasing the desirability to share value, work, and assets within the economy. This proposal has been accepted and assigned Ethereum Improvement Proposal EIP1491.

EIP1491 is a proposal that intends to contribute to the development of a human capital accounting standard on blockchain. EIP1491 allows for the implementation of standard APIs for human cost accounting tokens within smart contracts. This standard provides basic functionality to discover, track and transfer the motivational hierarchy of human resources.

Whereas blockchain architecture has succeeded in the financialising of integrity by way of transparency, correspondingly real-world outcomes will be proportional to the degree of individualisation of capital by way of knowledge.

What this means in an entrepreneurial economy is that where you have employers and workers looking to exchange value (work for money) there is now a proposed standard of how to go about this, and these standard assigns unit value to the labour/work that is done, and creates a meritocracy for those who will do the work i.e. a standard unit of labour with a coefficient that assigns value via points to education, years of experience, talent, and interests.

Suppose there is an employer who wishes to have job X done by a university graduate with three years’ experience, for which he is willing to pay Y amount of money. Utilising our standard API, the employer is able to compute how many labour hours he will be required to pay for, and what exact merit the employee will have, meeting the challenge of price discovery. The employer will also reduce his market search cost because he is able to track and locate the right candidate for the job. Both employer and employee are happy with the work because both are correctly directed to the right smart contract.

For millions of people in emerging economies around the world, the potential of EIP1491 will allow for individualised agency, rather than that agency being rooted in government. As we can all agree, despite the best of intentions, governments cannot be trusted to act in the interest of citizens. The best example for this is the debt-based culture that currently runs economies.

This means that an individual’s human resource, talent, interest and work has a value that can be exchanged at will because the individual has control over his agency. He is able to turn his different trades into capital that can be exchanged directly for purchasing power.

The ability to factor in growth in a knowledge-based economy ultimately should mean that not only is unemployment impeded, but that with increased utilisation, time becomes money, waste is reduced and the incidences of unrealised potential and missed opportunities are eliminated. Total factor productivity can be achieved in a shared agency ecosystem where millions engage willingly in exchanging value propositions using their own human capital.

We invite robust engagement and discussion on this standard and its applicability, and comments on the same.

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DEPOLITICISING DEVELOPMENT: Jubilee and the Politics of Spin

The tissue that connects the depoliticisation of development, the blind deployment of technology, and the professionalisation of the cabinet is Jubilee’s shamelessness. No political party is without faults and foibles, but in Jubileeland, shamelessness has taken an insidious form. By ABDULLAHI BORU HALAKHE

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DEPOLITICISING DEVELOPMENT: Jubilee and the Politics of Spin

In the Jubilee universe, it is almost an article of faith that politics is “bad” and development is “good”. It’s not uncommon to hear President Uhuru Kenyatta, Deputy President William Ruto, and high-level administration officials and their supporters’ constant put-downs directed at their opponents: “We don’t have time for politics, we are only interested in development.” They believe that the depoliticisation of development is necessary in order for them to deliver on their campaign promises.

While such a rhetorical sleight of hand is occasionally designed to silence opponents – who are supposedly opposed to development – in practice, it also reveals the Jubilee government’s limited understanding of politics. For them development is a cold, apolitical, technical exercise that is not only immune to politics, but transcends it.

More broadly, Jubilee’s politics-development dichotomy is an insidious attempt at redefining politics as criticising Jubilee, whether fairly or unfairly, and development as praising the administration, whether they are delivering or not. The net aim is to induce self-censorship among critical voices.

Techno-fallacy

Building a rhetorical firewall between development and politics is not a new idea; President Daniel arap Moi’s favourite retort when placed under pressure was “Siasa mbaya, maisha mbaya” (bad politics, bad life), never mind that under him, Kenya was firmly in mbaya zone. Maisha was so mbaya under Moi that economy growth was a mere 0.6 per cent when his successor Mwai Kibaki took over in 2002. Dissent was penalised and the country felt like a band that was dedicated to singing his praises. It is rather ironic that Jubilee, which would like to be remembered for good economic stewardship, would look to Moi for inspiration.

Building a rhetorical firewall between development and politics is not a new idea; President Daniel arap Moi’s favourite retort when placed under pressure was “Siasa mbaya, maisha mbaya”

The Jubilee government has also coupled the depoliticisation of development with a similar rhetoric on technology, in the process completely eviscerating nuances, complexities or grey areas when discussing public policy. You are either part of the cult of technology or you are not interested in progress.

In his book, To Save Everything, Click Here: The Folly of Technological Solutionism, Evgeny Morozov captures Jubilee’s approach to development: “Recasting all complex social situations either as neat problems with definite, computable solutions or as transparent and self-evident processes that can be easily optimised — if only the right algorithms are in place! — this quest is likely to have unexpected consequences that could eventually cause more damage than the problems they seek to address.”

For instance, one of Jubilee’s bright ideas of fixing the education system is to provide every child with a laptop, in line with their emphasis on learning science, technology, engineering, and mathematics as opposed to the humanities, which they see as not “marketable”. Never mind that only slightly over half of Kenya has access to electricity, that the teachers have not yet been trained or hired for the switch to using laptops, and most schools do not have computer labs. Jubilee is, after all, led by the dynamic digital duo that needs everyone to be wired.

Along with a blind faith in technology, Jubilee also regards corporate experience as a most prized asset in public appointments – as exemplified by the Harvard-educated former Barclays CEO, Adan Mohamed, who is the Cabinet Secretary for Industrialisation. For Kenyatta and his ilk, corporate experience, when coupled with technology, will fix pesky inefficiency and sloth in the public service.

This is not new; under pressure domestically from opposition groups, and externally from the Bretton Woods institutions, Moi appointed a “Dream Team” to key public offices. The officials were drawn from the private sector, international finance and development organisations. The group was led by Richard Leakey (the famous paleoanthropologist and former head of the Kenya Wildlife Service who had even formed a political party to oppose Moi in 1990s), who was appointed as the Secretary to the Cabinet and Head of the Civil Service. Martin Oduor-Otieno, a former director of finance and planning at Barclays Bank, was appointed as the Permanent Secretary in the Ministry of Finance and Planning and Mwangazi Mwachofi, the resident representative of the South Africa-based International Finance Corporation, became the Finance Secretary.

Along with a blind faith in technology, Jubilee also regards corporate experience as a most prized asset in public appointments – as exemplified by the Harvard-educated former Barclays CEO, Adan Mohamed, who is the Cabinet Secretary for Industrialisation. For Kenyatta and his ilk, corporate experience, when coupled with technology, will fix pesky inefficiency and sloth in the public service.

While Moi was boxed into a corner and had no option but to cater to donors’ wishes, Jubilee’s appointment of well-credentialed public officials from the private sector is an attempt to demonstrate that the government is using corporate best practice principles to manage the public sector. However, the appointment of individuals with private sector or international expertise is rooted in a lack of appreciation for received bureaucratic wisdom; it is a system of faceless, unelected officials keeping the state’s institutions humming along and ensuring continuity from one administration to another.

For Jubilee, bureaucracy is a dirty word. Both under Moi and under Jubilee, the credentialed senior public officials failed to deliver, although on balance, Moi’s cabinet, which had more court poets than individuals with diplomas from good schools abroad, did better.

Grievances and greed

Jubilee’s weaponisation of optics and breathless spin was honed when Uhuru Kenyatta and William Ruto – the two principals in the Jubilee coalition – were indicted by the International Criminal Court (ICC) for their alleged role in 2007-2008 violence.

Ruto and Kenyatta make an unlikely political team. The latter is a prince of Kenya’s politics and the former is a self-declared “hustler”. Even when considering Kenya’s shape-shifting political landscape and allegiances, the two couldn’t be more different.

But they were brought together by grievance and greed. They regarded their prosecution at the International Criminal Court as a witch-hunt; they argued that the two top presidential candidates during the 2007 election that led to violence and displacement were former President Mwai Kibaki and former Prime Minister Raila Odinga.

During the course of their indictments, the duo skillfully used social media and established themselves as bona fide underdogs. As a result, they refined their enduring ability to generate sometimes pugnacious, if not altogether needless, spin, which had tremendous traction with their base. Ruto and Kenyatta cast the ICC as an imperial project bent on getting them, effectively framing themselves – not those killed, maimed or displaced – as the victims of the post-election violence. Their spin was so effective that even some of the victims of the violence held “prayer rallies” for them.

In fairness, some of the reputational damage experienced by the ICC was self-inflicted. When I visited a IDP camp in Nakuru in 2011, one of the IDPs told me that the ICC’s Chief Prosecutor, Moreno Ocampo, had no time to visit them, and was busy doing safaris in Nairobi National Park.

During the course of their indictments, the duo skillfully used social media and established themselves as bona fide underdogs. As a result, they refined their enduring ability to generate sometimes pugnacious, if not altogether needless, spin, which had tremendous traction with their base. Ruto and Kenyatta cast the ICC as an imperial project bent on getting them, effectively framing themselves – not those killed, maimed or displaced – as the victims of the post-election violence.

The ICC was not the only victim of Jubilee’s rage; Raila Odinga, the cottage industry of upstart politicians, felt the full weight of Jubilee’s relentless propaganda blitzkrieg, part of it also emanating from his support for the ICC process, which Ruto, his lieutenant in 2007, interpreted as throwing him under the bus. (Ruto was a leading member of Odinga’s team during the 2007 election.)

After claiming some big domestic and foreign scalps, Jubilee started believing is own hype. While many dismissed Jubilee’s breathless social media campaigns during the elections as a passing fad once the cold reality of governing sets in, for Jubilee social media was the system. Beyond the hype, any critical assessment of Jubilee’s grand ideas, such as a 24-hour economy, 9 international standard stadia, and 21st century public transport, would show that they are all sizzle and no steak. The large-scale infrastructure projects were mostly designed as a gravy train, as the Standard Gauge Railway amply demonstrated.

Politics of shamelessness

The tissue that connects the depoliticisation of development, the blind deployment of technology, and the professionalisation of the cabinet is Jubilee’s shamelessness. No political party is without faults and foibles, but in Jubileeland, shamelessness has taken an insidious form. The shamelessness here is not the kind citizens have come to almost expect from the politicians; in Jubilee’s case, it is its modus operandi, a blunt object to hit opponents with. The lack of shame has not only been adopted by Kenyatta and Ruto, but also by their close lieutenants.

When the presidential results were announced two days after the annulled August 8, 2017 election, demonstrators and the police engaged in a running a battle in the Mathare slum in Nairobi. Police used live bullets and killed both demonstrators and bystanders. I spoke to some of the families of the victims and corroborated their stories with medical records and family witnesses.

The tissue that connects the depoliticisation of development, the blind deployment of technology, and the professionalisation of the cabinet is Jubilee’s shamelessness. No political party is without faults and foibles, but in Jubileeland, shamelessness has taken an insidious form.

But on August 12, at a press conference, the then Acting Internal Affairs Cabinet Secretary, Fred Matiangi’ denied that police had shot and killed people. He stated, “I am not aware of anyone who has been killed by live bullets in this country. Those are rumours. People who loot, break into people’s homes, burn buses are not peaceful protesters.” Yet it is not that Matiangi’ did not have access to the details of the people killed, some of whose deaths have been recorded in government hospitals and by the media and human rights groups.

Jubilee learnt some of this shameless spin from Moi’s Kanu party. In 2000, when drought was ravaging parts of Northern Kenya, the then government minister, Shariff Nassir, denied there was drought when pressed in Parliament by one of the area MPs. A few days later, the government declared a famine in Kenya.

President Kenyatta says that fighting corruption will be a key pillar of his legacy. The Auditor General’s Office has done more than any other state organ to reveal the level of corruption in government agencies through audit reports. In an ideal world, you’d think that the president would consider the Auditor General’s Office as a key ally. But the president scoffed at the Auditor General’s plan to investigate the activities of the Federal Reserve Bank of New York in relation to the alleged misuse of $2 billion Eurobond cash that Kenya raised in 2014. The president was quoted telling the Auditor General, “When you say that the Eurobond money was stolen and stashed in the Federal Reserve Bank of New York, are you telling me that the Kenyan government and United States have colluded?” The president then insinuated that the Auditor General, Edward Ouko, was stupid. Never mind that the president’s remarks came during a State House anti-corruption summit. It is also likely that the story of the missing Eurobond money will be the story of Jubilee’s corruption.

Lack of shame is dangerous when it comes from a place of entitlement – the #Mtado? phenomenon. Which naturally breads impunity.

David Ndii wrote, “Jomo Kenyatta’s regime was corrupt, illiberal and competent. Moi’s was corrupt, illiberal and mediocre. Kibaki’s was corrupt, liberal and competent. So, Moi scores zero out of three. Jomo scores one out of three. Kibaki scores two out of three.”

The original sin after 2010 constitution was promulgated was when a court ruled that Kenyatta and Ruto could contest the 2013 elections despite being indicted by the ICC. This officially killed Chapter Six on leadership and integrity of the Katiba, which effectively set Kenya down the path of “anything goes”.

Lack of shame is dangerous when it comes from a place of entitlement – the #Mtado? phenomenon. Which naturally breads impunity.

Kanu and Jubilee have ruled Kenya longer than any other party, and in the process have created the Kenyatta and Moi family and business dynasties. When under pressure, it is not uncommon to see Kenyatta and Jubilee seek Moi’s eternal wisdom. The visits to Moi’s home are done at the exclusion of William Ruto, which sets up 2022 neatly as the battle between the princes and the hustler.

Raila was a key player in the 2002 elections, and in 2013, Ruto was a key player in defeating Raila. In 2022, Ruto could face Raila’s fate. While Ruto’s defeat could delight many, the techno-dignified political opportunism that is Jubilee, which is illiberal, incompetent and corrupt, will endure.

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TERRORISM: Officialdom’s baffling silence in the wake of Sylvia Romano’s abduction

The potential significance of the abduction of Ms Sylvia Romano has already been pushed into the background but will this be yet another wake-up call to be ignored by the Government of Kenya. By ANDREW FRANKLIN

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TERRORISM: Officialdom’s baffling silence in the wake of Sylvia Romano’s abduction

Ms Sylvia Constanca Romano, a twenty-three year-old Italian NGO worker, was abducted on Tuesday, November 20, 2018 at 8 pm from her lodging in the remote trading centre of Chakama, located 80 km west of the Kenyan Indian Ocean resort town of Malindi in Kilifi County. Ms Romano was managing a children’s home for the Italian NGO, African Milele Onlus, and the armed men who took her were identified as being of Somali origin.

Weeks later, this Italian woman is still missing and while not immediately dismissing the involvement of Al Shabaab, the Government of Kenya is still resisting suggestions that the kidnappers were terrorists rather than ordinary thugs carrying AK-47s. Although initial reports in the Italian media were quick to blame Al Shabaab, the Italian Government just as rapidly asserted that the kidnappers were “armed herders” although, as quoted in the local media, fears were expressed that Ms Romano might have been sold on to Al Shabaab elements inside Somalia.

Italy was the preeminent colonial power in the Horn of Africa, especially in what is today effectively the Federal Government of Somalia (FGS) territory, which is currently being contested by jihadists. Italy contributes paramilitary police advisors to the nine-nation European Union Mission to FGS and has trained the Somalia Government police at its base in Djibouti; Italian Navy elements have participated in anti-piracy patrols off Somalia since 2008.

In October 2018, Al Shabaab in Mogadishu targeted a convoy of Italian security personnel returning to their base with a vehicle-borne improvised explosive device (IED). Although there were no Italian casualties, this attack on foreigners is not Shabaab’s modus operandi; the main targets of the terrorist organisation’s operations within Somalia have mainly been Somalis, although neighbouring Kenya has been a target since Operation Linda Nchi – the Kenyan Defence Forces (KDF) incursion into Somalia in October 2011. Some of the most deadly Al Shabaab attacks on Kenyan soil include the Westgate mall attack in Nairobi in September 2013 in which 67 people lost their lives and the Garissa University College massacre in April 2015, in which 147 students were brutally gunned down.

Elsewhere in the region, the Kenya Police recently took delivery of four Italian-made utility helicopters for use in its operations domestically against terrorists. Italy’s continuing role in the war on terror within the region remains low key and its government prefers to keep it that way.

It has been confirmed that at least three of the attackers had arrived in Chakama several days earlier and had rented lodgings and apparently observed village routines, including Ms Romano’s activities. Initial reports were that five heavily armed assailants had shot wildly during the Tuesday evening attack, wounding five Kenyans before seizing the Italian; there has yet to be an explanation for the origin of AK-47s or when they were smuggled into the trading centre. According to the police, the attackers fled with their hostage using two subsequently abandoned motorbikes before crossing a major river and disappearing into a rather thick bush.

It has been confirmed that at least three of the attackers had arrived in Chakama several days earlier and had rented lodgings and apparently observed village routines, including Ms Romano’s activities. Initial reports were that five heavily armed assailants had shot wildly during the Tuesday evening attack, wounding five Kenyans before seizing the Italian…

There is no permanent police presence in Chakama, which is located in a remote area of Kilifi County. It seems that there was no organised security forces’ response during the first 24 hours following the abduction. The security forces’ operating capabilities during the hours of darkness cannot be evaluated except for certain elite units (i.e. General Service Unit [GSU] Recon and KDF Rangers and Special Forces). Regular police and Administration Police (AP) units, regardless of designation, are not trained, organised or equipped for extensive patrolling. Although police helicopters were deployed to the area, it’s unlikely that the hastily cobbled together rescue force, comprising Kenya Wildlife Service (KWS) Game Rangers, KDF troops, GSU, APs and regular police, had the ability to coordinate ground forces with air support.

In fact, in the event that this was an Al Shabaab operation, the seeming reticence on the part of the security forces is understandable as it would be expected that Al Shabaab would plant IEDs and organise ambushes to slow down pursuit and inflict maximum damage on the rescuers. This is standard procedure and characteristic of all guerrillas fighting road-bound conventional forces; since 2016 Al Shabaab has been regularly ambushing KDF and/or police patrols across all five frontline counties in Kenya. Another foreseeable risk is that Al Shabaab will attempt to shoot down a police helicopter, as was reported on 2 September in the vicinity of Boni Forest in Lamu County.

Although remaining somewhat tight-lipped about the actual affiliation of the attackers, the expansion of search activities outside Kilifi County into neighbouring Lamu, specifically into Boni Forest, which straddles the Kenya-Somalia border, and the issuance of “WANTED” posters for three men of ethnic Somali origin – albeit without specific background details – point to officials believing this to have been an Al Shabaab terrorist operation. Since the kidnapping, the Kenya Police have taken more than twenty civilians in and around Chakamba into custody for questioning; the wife and brother-in-law of one of the three named suspects were arrested in Garsen in Tana River County when a telephone call was intercepted and traced back. As with the previously noted lack of explanation regarding the presence of AK-47s in Chakamba, there was no information provided as to whether the security forces were able to trace the GPS signatures of the suspects; Al Shabaab operatives would no doubt discard their phones to avoid detection. Perhaps these men are part-time insurgents or even freelancers?

Although remaining somewhat tight-lipped about the actual affiliation of the attackers, the expansion of search activities outside Kilifi County into neighbouring Lamu, specifically into Boni Forest, which straddles the Kenya-Somalia border, and the issuance of “WANTED” posters for three men of ethnic Somali origin – albeit without specific background details – point to officials believing this to have been an Al Shabaab terrorist operation.

Operation Linda Nchi and its after-effects

Operation Linda Nchi, a cross-border punitive expedition by 1,800 KDF troops, was launched on 15 October 2011 ostensibly in retaliation for alleged Al Shabaab kidnappings of Spanish MSF workers from the Dadaab refugee camp and tourists from Manda Island in Lamu, The latter attacks were eventually found to be the work of common criminals based in Ras Kamboni where pro-FGS forces hold sway. Al Shabaab’s involvement in the kidnapping of the Spanish volunteers was neither confirmed nor denied. Anecdotal evidence, however, indicates that the kidnappings within Somalia of locals has been used to raise funds not only by criminals but also by Al Shabaab, which has long made money from participating in transnational organised criminal activities, including charcoal smuggling, arms dealing, human trafficking and trade in illicit narcotics.

Al Shabaab attacks have taken place fairly regularly across the five Kenyan counties bordering Somalia, whose populations are overwhelmingly Muslim and predominately of ethnic Somali origin. Although Al Shabaab has eschewed headline-grabbing terror attacks, such as that on the Westgate mall in September 2013, its fighters regularly target police and KDF patrols, permanent security force bases, mobile telephone masts and power stations. Occasionally they also take control of villages and harangue inhabitants at night with little or no government interference. In June 2016, for instance, Al Shabaab took control of the villages of Mpeketoni and Poromoko in Lamu County and killed 60 men. The security response to this attack was dismal; there were stories of police stations in Mpeketoni being abandoned prior to the attack and villagers being left to their own devices to deal with the terrorists.

Since 2016, most professional security analysts agree that the Al Shabaab attacks have derailed devolution in the frontline counties of Mandera, Wajir, Garissa, Lamu and Tana River by severing the people from administrative functions. The attacks have throttled formal economic activities and disrupted delivery of education and social and health services. Civil servants, teachers, traders and students from outside these counties fear returning there after an attack. Most of the students who survived the Garissa University College attack, for example, were relocated to campuses in other parts of the country. Many teachers have also refused to be sent to these counties for fear of being attacked by Al Shabaab. These attacks have effectively normalised a state of endemic insecurity within which police elements and KDF units are alienated from the local citizens, many of whom are not convinced that they are truly citizens of the Republic of Kenya as their regions have been systematically marginalised and neglected since independence in 1963.

Despite attempts by all parties in Nairobi to portray events in Garissa, Tana River, Mandera, Wajir and Lamu counties as merely episodic terrorism that can happen anywhere in the world, the reality is that Al Shabaab insurgents are conducting a reasonably successful, low-intensity conflict that complements its operations to defeat the Western-backed FGS based in Mogadishu. In fact, the KDF invasion of Somalia and its subsequent incorporation into the African Union Mission in Somalia (AMISOM) inadvertently provided Al Shabaab opportunities to subvert the Kenyan government’s influences across the restive predominantly ethnic Somali counties, to expand recruitment, to increase revenue from transnational crime and to undermine the morale of a major troop-contributing country. Kenya, out of all the states adjacent to Somalia or involved in AMISOM, has been shown to have the most fragile domestic security architecture amidst a fractious political environment in which little or no attention is paid to matters of national insecurity.

Despite attempts by all parties in Nairobi to portray events in Garissa, Tana River, Mandera, Wajir and Lamu counties as merely episodic terrorism that can happen anywhere in the world, the reality is that Al Shabaab insurgents are conducting a reasonably successful, low-intensity conflict that complements its operations to defeat the Western-backed FGS based in Mogadishu.

The abduction of an Italian NGO worker from a remote market centre in Kilifi County, which is outside of Al Shabaab’s normal area of operations, had to have been well-researched and carefully planned. Nearly all Western states have prohibited their officials from working within the five frontline counties and tourists have been actively discouraged from visiting even popular resorts on Lamu Island. Travel advisories issued since 2012 have crippled Kenya’s tourism sectors, especially along the Coast in Malindi, Watamu, Kilifi and the beaches north of Mombasa; however foreigners like Sylvia Romano would not really have been warned off by their governments and are now the best targets available to Al Shabaab and/or disparate armed groups, including livestock raiders and poachers.

Western governments have pretty much placed most of the five frontline counties off limits to their employees and strongly discouraged their citizens from visiting them for any purposes. Al Shabaab has been very active in mainland Lamu County, which resulted in foreigners being discouraged from visiting popular locations on Lamu Island and adjoining islands. Although the UK lifted its travel advisory in May 2017, the position of the US Government and others remains oddly ambiguous.

However, Al Shabaab is considered one of the most dangerous of Al Qaeda’s global franchises; Al Qaeda cells blew up US Embassies in Nairobi and Dar es Salaam on 7 August 1998 and the terrorist organisation launched a suicide bomber against the Israeli owned Paradise Hotel in Kikambala in 2002. Simultaneously, Al Qaeda operatives unsuccessfully attempted to shoot down an El Al charter flight taking off from Mombasa. Al Qaeda has never backed away from threats to retaliate against citizens of enemy nations wherever they are located and it seems likely that Al Shabaab will expand activities wherever targets can be found.

The Italian connection

There are nearly 15,000 Italian citizens living in Malindi, Watamu and elsewhere on the Kenyan coast. The Italian government operates an official satellite tracking/space research facility just north of Malindi. During the pending festive season, hundreds more Italians will descend on an otherwise depressed holiday destination. In my view, Al Shabaab is implicitly threatening the safety of these people in order to leverage the Italian government to reduce its footprint in Mogadishu.

As with the kidnappings of foreigners in 2011, whether Al Shabaab fails to take responsibility or is ultimately found not to be culpable is less important than popular perception. The longer Sylvia Constanca Romano remains unfound, the greater the possibility that media attention, particularly in Italy, will speculate on whether Al Shabaab is involved and whether there is a link between the Italian government’s counterterrorism activities against Al Qaeda/Al Shabaab and her abduction.

Although the Chakamba market centre is several kilometres away from major Indian Ocean tourist towns, it is located in an area traversed by foreigners visiting Kenya for luxury safaris – the very same bush into which the Italian woman’s abductors fled. Whether this incident is the start of a high season offensive intended by Al Shabaab to further undermine the economy of Kilifi County cannot be ruled out. Doing so would further undermine support by the Kenyan public, especially at the coast, for KDF’s continued deployment to AMISOM, particularly if Italian security assistance to FGS is seen to falter.

So far, Nairobi’s Western allies have not extended stringent travel advisories outside of the five frontline counties but it can be expected that an unhappy outcome of yet another botched Government of Kenya anti-terrorist operation will impact negatively on economies of already shell-shocked coastal counties where there are strong undercurrents of opinion favouring self-determination and even secession.

Regardless of how this unfortunate incident plays out, the fact of its occurrence indicates that expert advice concerning best practices to respond to cross-border and even domestic attacks of this type have been ignored for more than seven years. The initial reaction to the news of the kidnapping followed the same old script in which personnel from different security forces were thrown together without appropriate training and organisation to track a small gang through unfamiliar terrain during the hours of darkness. Reports that police were detaining witnesses may mask employment by security personnel of heavy-handed and counterproductive methods, which have been the trademark of government forces since before independence in 1963.

It is notable, however, that the Kenyan government has successfully controlled the flow of information although it has to date set the narrative by avoiding any narrative. In this, the authorities have been aided by a seemingly disinterested and largely uninformed domestic media. Kenya’s mainstream press has avoided anything suggesting that the government’s war on terror, whether at home or in the near abroad, is less than a reasonable success under the circumstances. Local and international media have excluded security professionals who can document how officialdom has perversely ignored practical, common sense solutions to the myriad security issues that have evolved into a comprehensive existential threat to national security.

It is notable, however, that the Kenyan government has successfully controlled the flow of information although it has to date set the narrative by avoiding any narrative. In this the authorities have been aided by a seemingly disinterested and largely uninformed domestic media.

The potential significance of this kidnapping has already been pushed into the background; will this be yet another wake-up call to be ignored?

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